1MDB, Petrobras, FIFA, Odebrecht – are Swiss banks getting better at combating money-laundering? The statistics tell another story.
One year ago, Mark Branson (pictured below) of Switzerland's financial regulator said 15 banks were in a money-laundering danger zone. Statistics have borne this out: Swiss regulator Finma said it dealt with 22 cases of money-laundering last year, which is more than double the just nine it looked into in 2015.
The biggest case keeping Finma occupied last year? Undoubtedly 1MDB, a billion-dollar corruption scheme originating in Malaysia.
Last year, Finma helped shut down two Swiss banks operating in Singapore – Banca della Svizzera Italiana, or BSI, and Falcon Private Bank – and handed out sanctions and profit clawbacks.
Across Continents
The regulator didn't mention 1MDB by name in its annual enforcement report, which takes banks and bankers to task over ethical and legal violations. Finma uses the report to send a signal to Swiss banks, calling it «preventive» to show the «kinds of activities Finma will not tolerate and what it does to prevent them.»
«Finma investigated and sanctioned violations linked to international corruption cases, a process which consumed substantial time and resources,» the regulator wrote. Some of the cases were conducted in close cooperation with international peers, since the money trails crossed continents and financial centers.
Naming and Shaming
Overall, Finma's investigations totaled 625 last year, down from 794. It concluded 38 enforcement proceedings, which can target either institutes or bankers, which is also down from 55 such cases in 2015.
Finma has taken a more public tack in naming and shaming bankers, which comes alongside a more active tone from Switzerland's prosecutor in Bern, who is making much more active use of an article in Swiss law which permits the prosecution of firms for not doing more to prevent crimes like graft and money-laundering.
This is in response to a series of high-profile corruption probes that have swept through Swiss banking, such as Brazil's Petrobras and Odebrecht scandal or Uzbek/Karimova money.
