The Monetary Authority of Singapore (“MAS”) imposed a fine on Credit Suisse (SIX:CSGN) Group AG (NYSE:CS) and United Overseas Bank Limited (OTC:UOVEY) after concluding the two-year investigation of the connections between financial institutions in Singapore and Malaysian sovereign wealth fund, 1Malaysia Development Berhad (1MDB).
Though MAS failed to find pervasive control weaknesses at the banks, they were found guilty of violating several regulations relating to anti-money laundering and lack of appropriate scrutiny of customers' transactions. The regulator charged Credit Suisse and United Overseas with penalties of $0.5 million (S$0.7 million) and $0.6 million (S$0.9 million), respectively.
Apart from these banks, the authority imposed fines on four other banks, DBS Group Holdings Ltd. (OTC:DBSDY) , UBS Group AG (NYSE:UBS) , Coutts & Co. and Standard Chartered (LON:STAN) PLC. Also, it closed two Swiss-based private banks, BSI Bank Ltd. and Falcon Bank.
Further, MAS has banned several individuals found involved in the scandals, from providing financial advises and managing advisory firms in Singapore.
Both Credit Suisse and United Overseas accepted the charges and promised to improve anti-money laundering control systems. Also, they will donate the profits earned from the lapses to charities.
Credit Suisse’s shares have gained 5.4% in the last six months, underperforming the 11.6% growth for Zacks categorized Banks - Foreign industry.
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