On Sep. 17, FINMA announced Credit Suisse AML failure re FIFA.
- Announced the conclusion of two investigations into AML failings at Credit Suisse.
- An investigation identified deficiencies in anti-money laundering due diligence, re suspected corruption involving FIFA, Petrobras, Petróleos de Venezuela (PDVSA).
- Second re significant business relationship with politically exposed person (PEP).
- Deficiencies in AML process and bank's control mechanism and risk management.
- Ordered measures to improve AML, speed up implementing steps already initiated.
- Will commission independent third party to monitor implementation, effectiveness.
FIFA, Petrobras, PDVSA
- Shortcomings in identifying client, determining the beneficial owner, categorizing relationship as posing increased risk, clarifications, plausibility check, documents.
- Shortcomings occurred repeatedly over a number of years, mainly before 2014.
- Above-average faults in relationships opened by former subsidiary Clariden Leu.
- The bank still has no automated comprehensive overview of client relationships.
- Credit Suisse has been in process of implementing single client view since 2015.
- Progress has been made, but still to be extended outside the Compliance unit.
Politically Exposed Person
- FINMA initiated enforcement proceedings in 2016 and appointed an investigator.
- Bank was too slow to identify and treat the PEP client as posing increased risks.
- Due diligence and corresponding documentation re relationship were incomplete.
- Failed to meet heightened due diligence obligations re investigation, plausibility
checks and documentation reg client and certain related high-risk transactions.
- Bank failed to adequately record, contain, monitor the risks arising from the PEP
relationship and responsible (criminally convicted) client relationship manager.
- Relationship manager was very successful in terms of assets under management.
- Manager breached the bank's compliance regulations repeatedly and on record.
- Instead of disciplining, bank rewarded with high payments, positive assessment.
- Identified organisational deficiencies and lack of effective corrective intervention.
Measures to Strengthen AML
- Bank has addressed situation and adopted several measures since the end 2015
to strengthen its compliance in general and so as to combat money laundering.
- Cooperated with FINMA, which acknowledges improvements, some substantial.
- However, it has decreed additional measures to complement the bank’s actions.
- Designed to further improve bank’s governance, organisation, risk management.
- Remediate relevant control systems, processes, prove higher-risk relationships,
transactions are adequately detected, categorized, monitored and documented.
- Must implement single client view for all relationships, functions by end 2019.