The Monetary Authority of Singapore (MAS) has found lapses in anti-money laundering (AML) controls in DBS, Standard Chartered and UBS – following its probe into scandal-ridden Malaysian state fund 1Malaysia Development Berhad (1MDB).
MAS says its investigations – which began in March 2015 – have uncovered a “complex international web of transactions involving multiple entities and individuals operating in several jurisdictions”. The implicated financial institutions in Singapore include private bank BSI, DBS, Standard Chartered Bank (SCB), UBS, Falcon Private Bank and Raffles Money Change.
BSI’s Singapore branch was ordered to cease operations in May this year following its involvement with 1MDB – which involved “serious breaches of anti-money laundering requirements, poor management oversight of the bank’s operations and gross misconduct by some of the bank’s staff”, according to MAS.
Although MAS’s preliminary findings “did not reveal pervasive control weaknesses or staff misconduct within these banks, unlike in the case of BSI Bank”, there were still instances of control failings. The regulatory body also found weaknesses in monitoring transactions and “undue delay in detecting and reporting suspicious transactions”.
MAS says that the “deficiencies observed in DBS, SCB and UBS related to lapses in specific processes and by individual officers … were serious in their own right and will be met by firm regulatory actions against the banks”.
This follows US Attorney General Loretta Lynch’s announcement of filing a civil suit to seek the forfeiture and recovery of more than $1 billion in assets associated with 1MDB.
The city state has seized about $177 million worth of assets in the course of its investigations into fund flows concerning 1MDB.