Singapore’s central bank has fined Credit Suisse and United Overseas Bank (UOB) a total of S$1.6 million ($1.2 million) for breaching anti-money laundering rules in transactions related to Malaysia’s scandal-ridden state fund 1MDB.
The Monetary Authority of Singapore (MAS) said on Tuesday it had fined UOB S$900,000 and Credit Suisse (CSGN.S) S$700,000 as it wrapped up its two-year probe into banks involved in 1MDB-related transactions, which revealed several breaches of anti-money laundering (AML) requirements and control lapses….
“These include weaknesses in conducting due diligence on customers and inadequate scrutiny of customers’ transactions and activities,” it said in a statement, adding it did not, however, detect pervasive control weaknesses at UOB and Credit Suisse….
“While the fines imposed on UOB and Credit Suisse may appear low relative to the amounts that we see imposed by U.S. and UK regulators, they are substantive by Singapore standards,” said Nizam Ismail, partner at RHTLaw Taylor Wessing LLP, where he advises clients on financial services regulation.
Unlike the other penalties related to this investigation, which involved accounts managed by Jho Low, his alias Eric Tan or various subsidiaries of 1MDB, MAS has kept silent on the ownership of the illicit bank accounts managed by Credit Suisse and UOB.
In the absence of further explanation, Malaysians are therefore left with only one possible conclusion, which is that these two banks were managing accounts for Prime Minister Najib Razak. Accounts which MAS has clearly linked to 1MDB and which therefore now must have been frozen by Singapore.
A Prime Minister ought not to be protected in such a way and treated as some sort of special individual who is above the law, particularly if Singapore wishes to claim that it is a proper international banking centre, run by rules.
Deals have clearly been done, which show the hand of political interference – death to financial confidence. On the other hand, the compromise arrived at has clearly been designed not to let Najib off the hook completely and to open the way for eventual justice in this matter.
Singapore has confirmed the money in his accounts was dirty and has punished the banks’ failure to conduct due diligence on a politically exposed figure. They will not have released this money back.
The world is effectively waiting for Malaysians to show the guts and fortitude to deal with their own villains and chuck them out – then there will be a lot of money waiting to reward them!