Swiss-Asia Financial Services Faces $2.5M Fine for AML Violations, MAS Issues Reprimand to Executives

Singapore-based wealth and fund management firm Swiss-Asia Financial Services (SAFS) has incurred a penalty of S$2.5 million (€1.7 million) for breaching anti-money laundering (AML) regulations. The Monetary Authority of Singapore (MAS) also reprimanded Olivier Pascal Mivelaz and Steve Knab, respectively the CEO and COO of SAFS, for failing in their duties to ensure compliance with AML and combating the financing of terrorism (CFT) requirements.

MAS highlighted SAFS's failure to adequately verify the source of wealth of some customers and their beneficial owners, along with its omission to report suspicious transactions despite media allegations of financial misconduct involving certain customers. The regulator emphasized that between September 2015 and October 2018, SAFS experienced significant business growth but failed to upgrade its AML/CFT controls accordingly, leading to multiple breaches and exposing the firm to financial crime risks.

The identified breaches include insufficient due diligence on customers before establishing business relations, neglecting relevant risk factors in enterprise-wide risk assessments, and overlooking inconsistent third-party transactions in customers' accounts. Moreover, SAFS failed to conduct internal audits to monitor the effectiveness of its AML/CFT controls and compliance with regulatory requirements.

Regarding the reprimand issued to Mivelaz and Knab, MAS noted their approval of SAFS's inadequate enterprise-wide risk assessment and their failure to ensure regular internal audits over a four-year period despite substantial business growth. MAS stated that SAFS has since taken corrective actions to rectify the deficiencies identified.

Loo Siew Yee, Assistant Managing Director at MAS, stressed the importance of financial institutions providing wealth management services to high net worth individuals to mitigate money laundering and terrorist financing risks effectively. She emphasized the responsibility of boards and senior management to implement adequate AML/CFT controls and ensure that compliance and internal audit functions align with the institution's business growth.

By fLEXI tEAM