Bank J. Safra Sarasin is at high risk of being used as a conduit for illegal activities, MAS has warned.
The Singapore branch of Bank J. Safra Sarasin (BJS), a private Swiss bank, has been ordered to pay a $1m penalty for breaching anti-money laundering rules by the Monetary Authority of Singapore (MAS).
This is due to its failure to comply with the MAS' Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) requirements, taking into consideration BJS's remediation actions.
"Financial institutions engaging in private banking business must bevigilant in guarding against the risk of dealing with illicit wealth. Given the potential complexity of private bank clients’ profiles, it is particularly important that clients’ representations regarding theirsource of wealth and fundsare scrutinised and corroborated by objective evidence," said MAS Assistant Managing Director (Policy, Payments & Financial Crime) Loo Siew Yee in a statement.
According to MAS, the BJS committed serious breaches of these requirements from March 2014 to September 2018 during its customer on-boarding process and in its ongoing monitoring of business relations with customers.
BJS failed to establish the sources of wealth and funds of its customers, and failed to adequately inquire on the background and purposes of unusually large transactions with no economic purpose.
This has made BJS at risk of being used as a conduit for illegal activities.
BJS is required to appoint an indepentend party to validate the effectiveness of its remediation measures.