Belfast Telegraph

Standard Chartered and Coutts hit with fines by Singapore regulator

Singapore's financial regulators have slapped Standard Chartered and Coutts with multi-million pound fines for breaching anti-money laundering rules linked to their dealings with Malaysia's scandal-ridden state investment fund.

The Monetary Authority of Singapore (MAS) has charged the Singapore branch of Standard Chartered 5.2 million Singapore dollars (£2.8 million) after finding "significant lapses in the bank's customer due diligence measures" that resulted in 28 violations of anti-money laundering rules between 2010 and 2013.

Local operations run by Coutts, which is Royal Bank of Scotland's (RBS) private banking arm, have been separately fined 2.4 million Singapore dollars (£1.3 million) for due diligence failings on accounts established between 2003 and 2009, leading to 24 breaches.

However, MAS said that two officers that were partly responsible for those breaches left Coutts in late 2009.

Coutts is currently in the process of winding down its Singapore branch after selling its international operations to Union Bancaire Privee last year.

Singapore's regulator launched its investigation amid allegations that nearly one billion US dollars (£792 million) has been embezzled from the 1Malaysia Development Bhd (1MDB) by people close to Malaysian prime minister Najib Razak.

MAS managing director Ravi Menon said: "These actions send a strong signal that we will not tolerate the abuse of Singapore's financial system for illicit purposes.

"The supervisory investigations into the intricate web of international fund flows have been a learning experience for financial institutions as well as for MAS. Our financial sector will emerge cleaner and stronger from the lessons learnt."

Standard Chartered said: "We regret that 1MDB-related transactions passed through Standard Chartered Bank Singapore accounts from 2010 to early 2013."

The bank said it reported the suspicious transactions both before and at the time it exited the accounts in 2013 and has fully cooperated with authorities.

"Standard Chartered has taken, and continues to take remedial and disciplinary action where warranted and will continue to strengthen our controls, processes, and surveillance systems."

It said that all profits related to those transactions will be donated to charitable causes in Singapore.

An RBS spokesperson said that related profits from Coutts operations will be passed on to an anti-money laundering programme to help combat financial crime in the country.

RBS said: "We welcome the conclusion of the Monetary Authority of Singapore's (MAS) investigations into our legacy International business, Coutts & Co Ltd. We regret any failings in our AML processes and the length of time it has taken to detect and resolve this issue."

"Coutts & Co Ltd has progressively and substantially strengthened the policies and controls that it used to prevent its services being used by clients to aid financial crime.

"We are in the process of winding-down this Swiss-incorporated business, following the sale of the majority of the assets earlier this year. As announced in 2014, this sale reflects the revised risk appetite of RBS and its subsidiaries."