The Monetary Authority of Singapore has fined Credit Suisse and United Overseas Bank S$700,000 (US$506,433) and S$900,000 (US$651,131) respectively for breaking its money laundering and terrorist finance regulations.

The regulator claims that the firms' transgressions are linked to transactions connected to Malaysia's scandal-struck state-run 1MDB fund. It has also served three employees at banks involved in the matter with prohibition orders. On a separate matter, it intends to impose the same regulatory penalties on three others.

The fines round off the authority's two-year-long review of banks involved in 1MDB-related transactions known to date. It says that the probe is its biggest-ever investigation of illicit money flows. It has already ordered Falcon Private Bank and the Singapore arm of BSI to cease operations in Singapore and has imposed penalties of S$29.1 million (U$21 million) in aggregate on eight banks (BSI Bank, Falcon Bank, DBS, UBS, Standard Chartered Bank, Coutts, Credit Suisse and UOB) for various AML infractions.

Credit Suisse said "that the MAS review findings show there are no pervasive anti-money laundering control weaknesses." UOB, meanwhile, said: “We have [enhanced] our training programme to raise risk and control awareness among our staff...the MAS found that the control weaknesses were not pervasive."

The MAS has drawn attention to the firms' "weaknesses in conducting due diligence on customers and inadequate scrutiny of customers’ transactions and activities."

As usual, the regulator has ordered the banks to appoint independent parties to assure it that the remediation, when it takes place, has been successful. It has also instructed the firms to take disciplinary measures, where appropriate, against errant staff.  

The MAS also, updating an announcement it had made on 13 March, said that it had issued a lifetime prohibition order against Jens Fred Sturzenegger and Yak Yew Chee, as well as a 15-year prohibition order against Seah Mei Ying with effect from 29 May. Sturzenegger was the branch manager of Falcon Private Bank Ltd, Singapore branch (Falcon Bank), while Yak and Seah were employees of BSI Bank Limited (BSI Bank).

The regulator said: "Mr Sturzenegger has been convicted of financial crimes including providing false information to authorities in an attempt to cover up his knowledge of Falcon Bank’s relationship with Mr Low Taek Jho. Mr Yak and Ms Seah were convicted of multiple counts of failing to report suspicious transactions and of forging reference letters at BSI Bank on behalf of Mr Low."

It added that all three had been prohibited from (i) providing any capital markets and financial advisory services and (ii) taking part in the management of, acting as a director of, or becoming a substantial shareholder of any capital markets services or financial advisory firm in Singapore.

Separately, the MAS says that it intends to issue a prohibition order against Ang Wee Keng Kelvin, a former representative of Maybank Kim Eng Securities Pte Ltd (MKES). It has also served notice of its intention to issue a prohibition orders against Kevin Scully, the chief executive of NRA Capital Pte Ltd, and Lee Chee Waiy, its former head of research.

"Through Mr Ang’s introduction, NRA Capital was appointed to perform the valuation of PetroSaudi Oil Services Limited (PSOSL). On 24 May 2017, Mr Ang was convicted of an offence under the Prevention of Corruption Act for bribing Mr Lee with S$3,000 to expedite the preparation of the valuation report on PSOSL.

Mr Lee had been the primary person at NRA Capital who worked on the valuation. Apart from accepting the bribe, he was also found to have applied inappropriate methods and assumptions in the valuation of PSOSL. As the CEO of NRA Capital, Mr Scully had failed to ensure that his analyst, Mr Lee, had exercised sufficient care, judgment and objectivity in the valuation of PSOSL.

The proposal is to ban Ang and Lee for six years and Scully for three years in the same manner as the others.