Watchdog Marks 15 Swiss Banks As At Risk For Money Laundering

According to financial services watchdog FINMA, about 15 Swiss banks are exposed to the risk of money laundering — or are in what they the call the “red zone.”

The news comes as Swiss prosecutors have announced criminal proceedings against Zurich-based Falcon Private Bank in connection to money laundering linked to  Malaysia’s scandal-tainted 1Malaysia Development Berhad (1MDB) fund. BSI — a second Swiss bank — faced investigation by Swiss federal prosecutors in connection to 1MDB.

“We have introduced a warning system in relation to money laundering risks,” FINMA Chief Executive Mark Branson said in an interview with Swiss newspaper SonntagsZeitung. “Roughly 15 banks are in the red zone here. That means they are particularly exposed.”

Branson did not name names — but he noted that all parties singled out are involved in asset management and often deal with emerging markets as clients. FINMA also noted that lenders were from all areas of the country and of various sizes.

When placed on the list, it becomes incumbent on named institutions to provide FINMA with additional information. The goal of notification, Branson noted, is not to push banks out of emerging markets — but instead to push them to become better informed about the markets they are operating in.  FINMA has ordered Falcon to turn over 2.5 million francs ($2.56 million) in what the watchdog said were illegal profits. The firm has been allowed to keep its banking license — but could risk loss of it in the event of a second offense.

“Falcon was a hair’s breadth away from having its license withdrawn,” Branson said. “We are of the opinion that the new management deserves a chance.”

In addition to investigations linked to 1MDB and a scandal connected to Brazil’s state-controlled oil producer Petrobras (PETR4.SA), Branson said that FINMA is investigating an unnamed Swiss bank in relation to FIFA, the world soccer governing body mired in corruption probes.

“Here a procedure is under way against one bank,” he said. “We are talking about smaller amounts than with 1MDB or Petrobras.”



Latest Insights:

Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. The September 2019 Mobile Order-Ahead Tracker, serves as a monthly framework for the space. It provides coverage of the most recent news and trends as well as a provider directory that highlights key players across the mobile order-ahead ecosystem.


Click to comment


To Top