The 1MDB scandal has prompted widespread navel-gazing among global regulators and the financial services industry about the effectiveness of AML controls.
A top Swiss appeals court has rejected a banker's bid to lift his three-year regulatory ban from working in the industry over failures to properly fight money-laundering linked to scandal-warped Malaysian sovereign wealth fund 1MDB, Reuters has reported.
In a ruling released on Monday this week, the Federal Administrative Court turned down the appeal by the former senior executive at Swiss bank BSI, who had argued that Swiss watchdog FINMA's ban was based on factual errors, the news agency said in its report. (This publication was unable to locate the ruling on the Court’s website.)
The report added that the court found that a lower court was justified in concluding that the now-retired banker was personally responsible for serious violations of anti-money-laundering provisions and bank procedures.
Under Swiss reporting restrictions, the names involved in the criminal case were not disclosed.
After a transaction in 2016, BSI, which is now part of fellow
Swiss bank EFG International, was involved in the legal problems
of the Malaysia fund. Singapore’s main regulator ordered the
closure of the Singapore branch of BSI. It also ordered the
closure of the Singapore business of Falcon Private Bank.
The 1MDB scandal is one of the largest cases of money laundering ever. As much as $4.5 billion was allegedly embezzled - taken by senior officials and various associates. Authorities in Switzerland, Singapore and the US have since taken action.
Goldman Sachs has paid a total of $2.9 billion to worldwide regulators to resolve failures linked to a Malaysian financial scandal. Goldman Sachs underwrote, purchased and arranged three bond transactions in 2012 and 2013, raising $6.5 billion for 1MDB.
The 1MDB scandal has prompted widespread navel-gazing among global regulators and the financial services industry about the effectiveness – or lack thereof – of AML restrictions and associated controls.