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Four Financial Institutions in Singapore Hit With Fines for Activity Related to Wirecard ‘Scandal’

Singapore-based regulator, the Monetary Authority of Singapore (MAS), has fined four companies – totalling S$3.8million in total. Citibank, DBS Bank, OCBC and insurance provider Swiss Life (Singapore) were found guilty of breaching MAS’ Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT) requirements.

All of the financial institutions (FIs) involved have accepted the penalties given to them by the Singaporean regulator. MAS explained that the breaches were identified during its examinations of the four firms – following news of irregularities related to Wirecard’s financial statements and the involvement of Singapore-based individuals and organisations in the matter.

Each company were found to have, in some way, “inadequate” AML or CFT controls in place when dealing with individuals involved with Wirecard AG or its related parties in Singapore.

WirecardIn 2020, the German-based payments processor sensationally revealed that €1.9billion that was ‘missing’ from its accounts never existed in the first place. Earlier this week, the world’s first criminal convictions related to the Wirecard scandal took place in Singapore as a court handed out prison sentences to two former Wirecard Asia Holdings employees.

In an official release, MAS explained that while the newly found breaches by the four firms were serious, it “did not find wilful misconduct by any staff of these FIs”.

The penalties

DBS Bank received the largest penalty – S$2.6million for a range of breaches between July 2015 to February 2020. The bank failed to:

  • Maintain up-to-date customer due diligence (CDD) information
  • Update customer’s money laundering and terrorism financing risk ratings
  • Establish the source of wealth for higher-risk customers
  • Adequately inquire into the background and purpose of unusually large transactions

Meanwhile, OCBC received S$600,000 in penalties from the regulator for not inquiring into the purpose of transactions not consistent with its knowledge of the customer or business.

Citibank was slapped with the third largest penalty – having to repay S$400,000 for also failing to look into unusually large transactions that significantly exceeded one customer’s past transactions. It also failed to inquire into a payment to a party “allegedly involved in fraud”.

Swiss Life (Singapore) took the smallest hit of the four, with a penalty worth S$200,000 – for failing to sufficiently understand the reasons behind the higher-risk customer’s complex ownership and control structure and failing to adequately corroborate the source of wealth of the customer’s beneficial owner.

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