The Swiss Financial Market Supervisory Authority FINMA has found that Banca Credinvest seriously breached anti-money laundering regulations in its handling of Venezuelan client relationships. FINMA recently concluded corresponding enforcement proceedings and imposed a variety of measures.
FINMA opened enforcement proceedings against Banca Credinvest in November 2018 to investigate information it had received regarding possible violations of money-laundering rules. The information was received in the context of the alleged cases of corruption linked to the Venezuelan oil company PDVSA. These proceedings have now been concluded.
FINMA found that the bank’s money-laundering processes and its risk management were inadequate. In particular, the bank breached its duty of due diligence in relation to anti-money laundering regulations between 2013 and 2017. Specifically, the bank failed to adequately identify its clients or beneficial owners, failed to sufficiently monitor these clients’ transactions, documented the processes incompletely and reported suspicious activity to MROS too late.
FINMA orders series of measures
FINMA ordered a series of measures to restore compliance with the law, which the bank has already begun to implement. Among other things, the bank must monitor all private banking clients in order to identify increased money-laundering risks and adequately mitigate these. In addition, as decided by the bank itself it must rapidly withdraw from all client relationships with a connection to Venezuela and may not accept any new high-risk clients (e.g. politically exposed persons) for three years or until all measures have been implemented and reviewed at a later stage. Furthermore, FINMA ordered various organisational measures aimed at strengthening the combating of money laundering and risk management.
FINMA will act firmly against all violations of AML rules
In recent years the Swiss financial services industry has been caught up in several global corruption cases (Petrobras, Odebrecht, 1MDB, Panama Papers, FIFA and PDVSA). FINMA has therefore focused its AML supervisory activities on how institutions deal with such international money-laundering cases (see dossier on money laundering prevention). FINMA continues to designate money laundering as a major risk to the Swiss financial services industry. Correspondingly, the issue remains a core part of its supervisory activities (risk monitor).