Five Julius Baer bankers have joined the Bahamas branch of private bank Gonet. One of the five focused on customers from Venezuela – business that had alerted the regulators in Switzerland.

The defection of five Julius Baer bankers to rival Gonet is a major coup for the Geneva-based private bank. The team will work for the bank’s Bahamas branch in Nassau.

The move is remarkable in several ways: Patrick Feuz and Jean-Marc Fellay are the Julius Baer's top Bahamas executives. Feuz, head of Baer in Nassau, becomes the executive chairman of Gonet Bank & Trust. Fellay, previously in the rank of COO, will be moved up a notch to become CEO at the lesser-known private bank.

Onboarding Superstar

The three other bankers are Patrick Guye-Bergeret, Juan Carlos Hofer and Matthias Krull. The latter, the most prominent among the trio, is a senior relationship manager who was known as an «onboarding superstar» when Boris Collardi was still in charge in Zurich. He earned his nickname thanks to his stellar ties to Venezuela.

Krull, who went to school in Caracas, developed his network in the capital of Venezuela for more than a decade and lured numerous members of the strong German diaspora to Julius Baer. When the security situation deteriorated in the country, Krull and his family moved to Panama, from where he continued to acquire assets from people based in the oil-rich nation.

The banker managed some $600 million before he decided to move, according to sources at the bank. But it is exactly this money that has also attracted unwelcome attention, because Krull worked with numerous politically exposed persons, or so-called PEPs.

Enforcement Probe

Finma, Switzerland’s banking regulator is requiring the financial market to take extra care with assets belonging to PEPs to avoid tainting Switzerland’s image through money laundering and tax evasion. It isn’t known whether Krull has been prudent enough in handling the assets from Venezuela and Julius Baer didn’t comment when finews.com contacted the firm. Krull in any case booked most of those customers on the Bahamas, where Feuz and Fellay were in charge.

Finma did look at the books of several Swiss banks in connection with a corruption case at Venezuela’s oil company. One of the banks was Julius Baer. Swiss newspaper «Neue Zuercher Zeitung» (in German, behind paywall) reported that Finma was implementing an enforcement procedure against Julius Baer. The reason for the procedure was a lack of diligence in its client acquisition in relation to the corruption case engulfing the PDVSA oil company, the paper said.

Julius Baer so far hasn’t denied or even commented on the enforcement procedure. The bank however is undergoing a project named «Atlas», which involves re-registering its clients according to the know-your-customer regulation.

Giant vs Minnow

It isn't known if any of Krull’s clients flunked the test. The onboarding superstar however has left the company that manages some 400 billion Swiss francs and joined a company that has some 4 billion under management. His new employers hailed the hiring of the banker as the start of a new period of growth.

Julius Baer by contrast merely noted that the departures came in connection with strategic adjustments at its South American business. Former Goldman Sachs banker Beatriz Sanchez was put in charge of that business at the end of last year.

The bank didn’t elaborate on the adjustments it mentioned. The booking center on the Bahamas, where Krull had his clients registered, will remain in any case. But somehow there is hardly anybody to be found at Julius Baer who would be particularly upset about Krull’s departure.