Singapore, Swiss regulators claim internal lapses, serious misconduct by BSI in 1MDB case

SINGAPORE and Swiss regulators issued statements within a minute apart on Tuesday indicating serious misconduct and lapses at Swiss private banker BSI and its Singapore arm that have been embroiled in the scandal involving 1Malaysia Development Berhad (1MDB).

The Office of the Attorney General of Switzerland (OAG) said it has opened criminal proceedings against BSI SA Bank, the Swiss parent of BSI Singapore, on suspected deficiencies in the bank's internal organisation which was "unable to prevent the commission of offences" currently under investigation in the 1MDB-related criminal proceedings.

Swiss law allows the prosecution of a company that is suspected of not taking all the reasonable organisational measures that are required to prevent third parties from committing offences and, in particular, money laundering or corruption offences, said the OAG in the statement.

It said the criminal proceedings opened on May 23 against BSI SA are based on information revealed by the criminal proceedings related to 1MDB and on issues raised in the decision of Finma (Swiss Financial Market Supervisory Authority).

"The information suggests that the offences of money laundering and bribery of foreign public officials currently under investigation in the context of the 1MDB case could have been prevented had BSI SA been adequately organised," said the Swiss authority.

Singapore's Attorney-General's Chambers (AGC) said it has received findings from the Monetary Authority of Singapore from its inspection of BSI Bank Limited (BSI Singapore) which indicate serious misconduct by some members of the senior management and bank staff.

To date, prosecutors have filed charges against Yeo Jiawei, former wealth planner with BSI Singapore, and "further charges will be tendered in due course", said the AGC.

As for the five other individuals named by MAS, the AGC said it will work with the Commercial Affairs Department to review the facts before assessing the next appropriate course of action.