ZURICH (REUTERS) – Switzerland’s financial markets watchdog Finma has found serious shortcomings in Julius Baer’s efforts to combat money laundering over nearly a decade, Finma said, appointing an auditor and prohibiting the bank from doing large acquisitions.
Finma said in a statement the failings between 2009 and early 2018 were connected to alleged cases of corruption linked to Venezuelan oil company PDVSA and world soccer body Fifa, resulting in enforcement proceedings which Finma had now concluded.
Finma had conducted inspections at several Swiss banks in relation to these cases and appointed an agent to investigate Julius Baer in 2017. It broadened its investigation into the bank in 2018 following the arrest of a Baer client adviser in the United States and in response to events in Venezuela.
Finma said the bank had to take effective measures to comply with its legal obligations, including changing the way it recruits and manages client advisers, It barred Baer from large and complex acquisitions until it fully complied with the law.
An independent auditor would supervise the implementation of the measures, Finma said.
Julius Baer acknowledged Finma’s conclusions on shortcomings in fighting money laundering in its Latin American business.
It said in a statement it had already taken comprehensive measures to strengthen its compliance and risk culture – progress Finma acknowledged in its statement – and would “rapidly and resolutely” enforce implementation of the measures.
Baer, Switzerland’s third-largest listed bank, last year appointed Philipp Rickenbacher as chief executive, opting for a company insider to drive growth.
He replaced Bernard Hodler, its former risk chief who took over when predecessor Boris Collardi abruptly left in 2017 to run unlisted rival Pictet.
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