MAS to Inspect Credit Suisse amid Money Laundering Scandal

<p>Singapore's
financial regulator, the Monetary Authority of Singapore (MAS), is set to conduct
an on-site inspection of Credit Suisse Group AG. A move prompted by the recent
money laundering scandal which has sent shockwaves through the city-state. </p><p>MAS Targets Credit Suisse's
Local Unit for Examination</p><p>This
action comes in the wake of at least one of Credit Suisse's customers being
charged with money laundering, part of a larger investigation that has
embroiled several domestic and international banks in Singapore.</p><p>The
local unit of Credit Suisse is among the institutions targeted for examination
by MAS to assess the adequacy of their handling of high-net-worth clients.
According to sources familiar with the matter, MAS officials will soon be
conducting interviews with personnel and scrutinizing documents. These
individuals requested anonymity because the information had not been made
public.</p><p>This
regulatory intervention highlighted the gravity of the ongoing scandal, which
involves the seizure of over S$2.8 billion in assets, including cash and
jewelry, linked to a group of alleged money launderers of Chinese origin.</p><p>MAS's
upcoming inspection is distinct from its routine interactions with banks and has suggested concerns regarding the financial institutions' significant exposure to
the suspects and their overall procedures for client vetting.</p><p>Credit
Suisse is among the banks known to have connections with either the accused
individuals or their companies. For instance, one of the suspects, Vang
Shuiming, held S$ 92 million in an account with the Swiss lender, marking the
largest known account associated with the case.</p><p>Credit
Suisse, when approached for comment, declined to provide a statement. An MAS
spokesperson referred to comments made by the Minister of State, Alvin Tan in
parliament earlier this month. Tan had stated that the regulator was conducting
supervisory reviews and inspections of banks with "a major nexus" to
the case, expressing concerns about the predominance of financial assets in the
seized assets.</p><p>Vang
Shuiming, one of the suspects, held accounts at other banks, including Bank
Julius Baer (S$ 33 million), United Overseas Bank, and RHB Bank Bhd.'s
local unit, according to police affidavits. Vang faces multiple charges,
including forgery of a bank document to deceive Citibank <a href="https://www.financemagnates.com/tag/singapore/" target="_blank" rel="follow">Singapore</a>.</p><blockquote><p lang="en" dir="ltr">EXCLUSIVE: Singapore’s financial regulator will launch an on-site inspection of Credit Suisse after at least one client was charged with money laundering <a href="https://t.co/nk7CVCVHec">https://t.co/nk7CVCVHec</a></p>— Bloomberg (@business) <a href="https://twitter.com/business/status/1714475352766955651?ref_src=twsrc%5Etfw">October 18, 2023</a></blockquote><p>Credit Suisse's Previous
Encounter with MAS Scrutiny in 2017</p><p>It
remains unclear which other banks will undergo inspection by MAS. The probe is
expected to examine internal red flags raised and the timing of filing
suspicious transaction reports.</p><p>For
Credit Suisse, this inspection is just one of several challenges for its new
parent company, UBS Group AG, as it focuses on integrating thousands of
employees from its former rivals across the world. </p><p>This
isn't the first time <a href="https://www.financemagnates.com/tag/credit-suisse/" target="_blank" rel="follow">Credit Suisse</a> has faced scrutiny from <a href="https://www.financemagnates.com/tag/mas/" target="_blank" rel="follow">MAS</a>. In 2017, it was
inspected for its involvement in the '1MDB scandal', Malaysia's largest
corruption case, which resulted in a S$ 700,000 fine, the smallest penalty
imposed on banks in Singapore at that time.</p><p>Since
the eruption of the current case in August, Singaporean banks have intensified
their scrutiny of clients, particularly those of Chinese origin with multiple
passports. Authorities are also exploring potential links between the accused
individuals and single family offices, with plans to tighten relevant
regulations as necessary.</p><p>Investigations
into the money-laundering ring date back to 2021 when banks and companies filed
suspicious transaction reports, as communicated by Singapore's Minister of
Communications, Josephine Teo. These reports played a crucial role in alerting
authorities to suspicious activities within the country's financial system.</p>

This article was written by Tareq Sikder at www.financemagnates.com.