SINGAPORE (AP) — Singapore regulators announced Friday fines amounting to over $5.3 million for two banks that were found to have breached money laundering rules in dealings with an indebted Malaysian state fund.
The Monetary Authority of Singapore fined the local branch of Standard Chartered Bank, which is headquartered in London, 5.2 million Singapore dollars ($3.6 million) for “significant lapses” in customer due diligence measures and controls.
Regulators also fined the Singapore branch of private bank Coutts 2.4 million Singapore dollars ($1.7 million) for inadequate customer due diligence on “politically exposed persons.” Coutts is winding down its Singapore operations after the Royal Bank of Scotland sold it to Union Bancaire Privee last March.
Singapore’s actions result from findings of a multinational probe into allegations that people close to Malaysian Prime Minister Najib Razak stole more than $1 billion from 1MDB, or 1Malaysia Development Bhd.
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“The control lapses stemmed from inadequacies in policies and procedures, insufficient independent oversight of front office staff, and a lack of awareness of money laundering risks among some bank staff,” the monetary authority said in a statement.
In February, Singapore authorities said they had “seized a large number of bank accounts” in connection with the Malaysian fund probe.
Regulators are expected give a final update on their findings in early 2017.
The monetary authority said it planned to impose a 10-year ban on conducting banking business and functions on a former Goldman Sachs executive.
Tim Leissner, who led Goldman Sachs’ Singapore branch, managed three 1MDB bond issuances from 2012 to 2013 and issued an unauthorized reference letter to a financial institution in Luxembourg last June.
The authority said Leissner falsely claimed the bank had conducted due diligence on businessman Low Taek Jho, who is close to Najib’s family.