A regular round-up of compliance news, such as fines, permissions, new technology solutions to make tracking risks easier, and other developments.

The US Federal Reserve
The Federal Reserve has permanently banned former senior Goldman Sachs executive Andrea Vella from the banking industry for his role in financing scandal-hit 1MDB, the Malaysian state-run fund.

Goldman Sachs arranged bond offerings in 2012 and 2013 for 1Malaysia Development Berhad – aka 1MDB. Vella failed to escalate Low Taek Jho's involvement in the bond offerings. Low was a person of “known concern to Goldman, and his involvement indicated heightened potential underwriting risks”, the Fed said. Low and two former Goldman employees, Tim Leissner and Roger Ng, have been charged by the Department of Justice for participating in a criminal scheme to divert proceeds of the bond offerings from 1MDB for their personal benefit and bribing certain government officials in Malaysia and Abu Dhabi.

In March 2019, the Fed permanently prohibited Leissner from banking and fined him $1.42 million for his role in the scheme to divert bond proceeds. Ng is currently prohibited from banking by the Fed.

The scandal concerning 1MDB has rocked markets worldwide. Claims centre on how the institution was used by public officials, including a former prime minister, to siphon off funds for personal use. Authorities in Singapore, Switzerland and the US, among others, have probed into a money trail running into billions of dollars. The affair has prompted further soul-searching about the extent of money laundering in the world’s financial system.