The Monetary Authority of Singapore (MAS) has imposed a composite penalty of SGD 2.5 million on Swiss Asia Financial Services Private Limited (SAFS) for breaching MAS' anti-money laundering and countering the financing of terrorism (AML/CFT) requirements.

MAS has also issued warnings to Mr. Olivier Pascal Mivelaz, CEO, and Mr. Steve Knabl, COO of SAFS, for failing to discharge their responsibilities and functions in ensuring SAFS' compliance with MAS' AML/CFT requirements.

From September 2015 to October 2018, SAFS, as a wealth and fund management company, experienced significant growth in its business. However, its AML/CFT controls across various areas did not keep pace with this growth and were inadequate, resulting in multiple breaches of MAS' AML/CFT requirements during the same period. This exposed SAFS to the risk of financial crime.

The breaches identified during MAS inspections include:

1. Failure to consider certain relevant risk factors of company clients and business activities in the enterprise-wide risk assessment (EWRA);
2. Failure to conduct customer due diligence (CDD) measures before establishing business relationships, and in some instances, establishing business relationships before completing CDD measures;
3. Failure to review multiple third-party transactions in customer accounts despite inconsistencies with SAFS' understanding of the customers;
4. Failure to identify some customers with higher money laundering or terrorism financing (ML/TF) risks, even in the presence of red flags (e.g., corporate clients with bearer shareholding), resulting in inadequate enhanced CDD measures for these customers. For other customers identified as higher ML/TF risks, SAFS failed to sufficiently ascertain the sources of wealth and/or funds of the customers and their beneficial owners. SAFS also established or continued business relationships with certain of these high-risk customers without approval from senior management;
5. Failure to submit suspicious transaction reports to multiple customers despite sufficient grounds (e.g., SAFS being aware of news reports alleging financial crimes involving the customers);
6. Failure to conduct any internal audits to oversee the effectiveness of the company's AML/CFT controls and its compliance with regulatory requirements.

MAS has also warned Mr. Mivelaz and Mr. Knabl for failing to discharge their duties and functions as CEO and COO, respectively, to ensure SAFS' compliance with MAS' AML/CFT requirements. In particular, they approved inadequate EWRA. Over the four years, they also failed to ensure regular internal audits to assess the effectiveness of SAFS' AML/CFT controls under significant business growth.

SAFS has taken necessary corrective measures to address the deficiencies identified by MAS.