Swiss watchdog investigates Julius Baer managers for violations of AML regulations
The Swiss Financial Market Supervisory Authority (FINMA) today announces investigations into Julius Baer managers over anti-money laundering failings.
FINMA’s investigation concerned serious breaches of anti-money laundering regulations by Julius Baer, particularly in connection with alleged cases of corruption in Venezuela. These investigations concerned in particular four high-ranking managers. FINMA launched enforcement proceedings in one case. In a second case, FINMA discontinued proceedings after the person concerned had credibly agreed not to accept a managerial position at a supervised institution in the future. Finally, the regulator reprimanded two further people in writing.
The watchdog says it can ban individuals who are responsible for a serious breach of supervisory law from acting in a senior role at an organisation it supervises. The prohibition from practising a profession may be imposed for a period of up to five years. The measure has a preventive character. Its purpose in particular is to prevent the person concerned or other financial market players from committing similar violations of the law in the future.
FINMA has used the tool of imposing an industry ban in particular since 2014. It has issued around 60 such bans. Managers at all levels of organisations were affected.
The regulator notes it was in contact with over 30 Swiss banks in connection with alleged cases of corruption linked to the Venezuelan oil company PDVSA. FINMA investigated whether and to what extent the banks were involved in this case and whether the provisions of Swiss supervisory law were upheld. FINMA ultimately opened five enforcement proceedings in order to investigate specific information it had received regarding possible violations of money-laundering rules.
Let’s recall that, in September 2018, FINMA concluded two enforcement procedures against Credit Suisse AG. In the first procedure, FINMA identified deficiencies in the bank’s adherence to anti-money laundering due diligence obligations in relation to suspected corruption involving the International Federation of Association Football FIFA, the Brazilian oil corporation Petrobras and the Venezuelan oil corporation Petróleos de Venezuela, S.A. (PDVSA). The second procedure relates to a significant business relationship for the bank with a politically exposed person (PEP).
And, in October 2020, FINMA said it found that Banca Credinvest seriously breached anti-money laundering regulations in its handling of Venezuelan client relationships. The regulator concluded corresponding enforcement proceedings and imposed a variety of measures.