October 10, 2016: FINMA takes enforcement action against Falcon Private Bank

Swiss authorities ordered Falcon Private Bank to disgorge 2.5 million Swiss francs of profit, and barred it from doing business with foreign Politically Exposed Persons (PEP) for 3 years. Authorities are also pursuing charges against two former executives.

The penalties were imposed due to the bank’s inadequate vetting of business relationships and transactions associated with 1MDB, the Malaysian sovereign wealth fund. The notice also notes that, in addition to deficiencies in due diligence and monitoring, concerns raised by internal staff were ignored, and two board members were directly involved in the acquisition of the 1MDB business, which produced a chilling effect on bank managers.

FINMA also stated that the bank’s license could be in jeopardy in the case of further AML program deficiencies.

Link:

FINMA notice

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