Coutts & Co told to pay £5m by Swiss watchdog for anti-money laundering failures in dealings with 1MDB
Coutts & Co has today been ordered to pay CHF 6.5m (£5.2m) by Swiss watchdog Financial Market Supervisory Authority (Finma) over anti-money laundering failings in its dealings with scandal-hit Malaysian 1MDB.
The watchdog, which launched enforcement proceedings last year, claims the private bank "failed to adequately clarify the circumstances surrounding a number of business relationships and unusually large, high-risk transactions".
In particular, Coutts & Co, a Swiss incorporated firm sold by RBS early last year, is said to have engaged in several high-risk transactions linked to 1MDB between late 2009 and early 2013.
Finma also claims Coutts failed to follow up on internal information when it came to light, and also stalled on raising suspicions to the relevant authorities until 2015, despite the watchdog noting a number of employees flagged serious concerns.
Finma ordered the bank to hand over CHF 6.5m worth of unlawfully generated profits, and added it would be starting enforcement actions against certain bank employees involved in due course.
However, as the company is currently being wound down, Finma decided not to impose stricter measures.
"We welcome the conclusion of the Finma investigation into our legacy international business, Coutts & Co," an RBS spokesperson said. "We regret any historic failings in our anti-money laundering processes. Coutts & Co has progressively and substantially strengthened its anti-money laundering policies and controls."
1MDB is currently embroiled in a corruption scandal and is the subject of money laundering investigations in more than five countries.