Finma lowered the profit clawback from Banca della Svizzera Italiana, a now-defunct Swiss private bank which was sanctioned over its dealings with 1MDB four years ago. It banned two ex-BSI bankers.
The Bern-based financial regulator is knocking 25 million Swiss francs ($28 million) off a landmark 2016 enforcement against BSI, a Swiss private bank which dealt extensively with 1MBD, it said in a statement on Thursday. The regulator also banned two unnamed ex-BSI bankers for several years, it said.
The outcome is the result of a more than four-year-long court tussle between the bank, founded in Lugano in 1873, and its regulator. BSI was the first domino to fall in connection with 1MDB in Switzerland: many private banks including UBS and Edmond de Rothschild were ultimately also sanctioned. The scandal still ructions through high finance: Goldman Sachs is poised to pay $2.8 billion to settle its involvement.
Millions to BSI Seller
EFG, which had pursued BSI's legal case after acquiring the bank in 2016 for $1.06 billion, acknowledged Finma's decision to lower the profit clawback to 70 million francs instead of 95 million francs, in a statement on Thursday. The Zurich-based bank said the lower fine won't affect its financial results: the provision for the payment returns to BSI's previous owner, BTG Pactual, as agreed during the 2016 deal.
Finma said one of the bankers which it banned violated supervisory law, but that it wouldn't order any other measures against them. It shut the second case with a ban after the banker agreed they wouldn't take a management position at a Swiss bank again. Both people have appeals against the bans pending in federal court.
Banker Appeals Ban
Finma said it issued reprimands to four more – none of the people involved were named. A lawyer for Hanspeter Brunner (pictured below), BSI's star private banker in Asia until the scandal blew open, confirmed to finews.com that Brunner was the recipient of one of Finma's professional bans.
Brunner is appealing to overturn it, as well as to fight Finma's supervision of BSI's Singaporean subsidiary, the lawyer said. A criminal investigation in Singapore is ongoing, the lawyer confirmed.
It is impossible to decipher which BSI or board members – besides Brunner – Finma conducted fitness and probity proceedings into. Ex-BSI chairman Alfredo Gysi has disappeared into the obscurity of London art patronage. Long an elder statesman of Swiss banking, Gysi had singled out the banker who brought in 1MDB business for praise, as finews.com reported.
