“FINMA has instructed Julius Baer to undertake
effective measures to comply with its legal
obligations in combating money laundering
and rapidly finalise the measures it has already
started putting in place,” the authority wrote
in announcing the closure of the probe of
the bank. “The Board of Directors must also
give greater attention to its AML (anti-money
laundering) responsibilities.”
The Zurich-based bank, which had 426
million Swiss francs (dollars) of assets under
management at the end of 2019, said it “takes
note” of the decision. The bank said it cooperated
“extensively” with the authority, and that “the
identified deficiencies have been addressed.”
The authority’s investigators unearthed
“systematic failings” in the application of
Swiss anti-money laundering law, turning up
irregularities in “almost all of the 70 business
relationships” that were selected due to their
risk. The “vast majority” of over 150 transactions
examined also showed irregularities, FINMA said.
Julius Baer didn’t do enough to determine clients’
identities, provide information about the source
of their wealth, or monitor transactions properly.
One adviser handling Venezuelan clients in 2016
and 2017 reaped millions in bonuses and other
payouts even though the bank had spotted
possible wrongdoing in connection with a case
involving state oil giant PDVSA.
“The bank’s remuneration system focused
almost exclusively on financial targets and
paid scant regard to compliance and risk
management goals,” FINMA said.
“As an example, a CHF 70 million (about $70
million) transaction was carried out in respect