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Category: Corruption / Banking

Singapore kicks out Swiss bank linked to Malaysia's 1MDB scandal

Tuesday, 24 May 2016 15:40:13

Singapore's central bank is kicking out Swiss bank BSI. (AFP: Roslan Rahman)

Singapore's central bank says it is kicking out Swiss bank BSI, which has been linked to a global money-laundering scandal at Malaysia's state fund 1MDB that has embroiled Prime Minister Najib Razak.

The Monetary Authority of Singapore (MAS) said it has served the bank with a "notice of intention to withdraw its status as a merchant bank in Singapore for 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".

In a statement, the MAS said it had also asked state prosecutors to investigate six senior executives of BSI Bank Limited, including its former chief executive for possible criminal offences.

Two Singaporean executives of the bank already face charges in the city-state.

The MAS said this is the first time it has cancelled a merchant bank's licence since 1984, when the local branch of Jardine Fleming was shut down for "serious lapses" in its advisory work.

1MDB, founded in 2009 by Mr Najib, is teetering on the brink of collapse amid multiple investigations around the world into allegations that billions were looted from it.

The fund, which ran up more than $US11 billion ($15 billion) in debt in a series of much-questioned investments, has steadfastly denied money was stolen or that it was in financial trouble.

Last year, the Wall Street Journal revealed $US681 million in transfers to Mr Najib's personal bank accounts.

He said the money was a gift from the Saudi royal family, most of which he returned.

In April, a Saudi official said that was true, but only after weeks of silence that cast doubt on the claim.

In a series of more recent investigative reports, however, the newspaper said Malaysian investigation documents indicated more than $US1 billion in 1MDB-linked money had been funnelled to Mr Najib.

He and 1MDB vehemently deny that claim.

The Prime Minister has faced calls to resign but he has tightened his grip on the ruling party and thwarted domestic investigations.

AFP

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