Credit Suisse Entangled in Singapore’s Gambling-Fueled Money Laundering Debacle

Posted on: October 19, 2023, 06:55h. 

Last updated on: October 19, 2023, 11:17h.

Credit Suisse finds itself entangled in the midst of Singapore’s gambling-fueled money laundering scandal. That’s as the Monetary Authority of Singapore (MAS) gears up to scrutinize the bank’s handling of wealthy clients, shedding light on the gravity of a debacle that has implicated multiple domestic and international financial institutions.

The entrance to a branch of Credit Suisse bank
The entrance to a branch of Credit Suisse Bank. The Monetary Authority of Singapore is investigating the company for possible involvement in a recent money laundering scandal. (Image: Reuters)

Singapore’s financial landscape is under intense scrutiny, as the Monetary Authority of Singapore (MAS) prepares to conduct a thorough examination of Credit Suisse and other banks. They could possibly be implicated in the gambling-driven money laundering scandal that has disrupted the Asian financial hub.

The investigation aims to determine the adequacy of these banks’ monitoring mechanisms for wealthy clients. This marks a departure from routine engagements and emphasizes the severity of the situation that has embroiled at least 10 financial institutions.

Deja Vu for Credit Suisse

The probe follows the seizure of more than SGD2.8 billion (US$2 billion) in assets, including cash, jewelry, and real estate from alleged money launderers. This significant crackdown underscores the scale of the illicit financial activities that have permeated Singapore’s banking sector.

The upcoming inspection by MAS is poised to delve into the banks’ possible connections with the suspects. It will also evaluate the overall efficacy of their client vetting processes, signaling potential vulnerabilities and lapses in compliance.

Among the banks under the MAS microscope is Credit Suisse, a financial institution no stranger to controversy. Credit Suisse, which banking giant UBS purchased earlier this year, played a notable role in the infamous 1Malaysia Development Berhad (1MDB) saga, the largest corruption case to hit Malaysia.

The 1MDB scandal involved the misappropriation of billions of dollars from a state investment fund, leading to investigations and legal actions worldwide. Credit Suisse, in particular, faced scrutiny from MAS in 2017 in connection with the scandal.

The regulatory authority investigated the bank’s involvement. It was subsequently hit  with a SGD700,000 (US$509,320) fine as a consequence of lapses in anti-money laundering controls and compliance standards.

This history places Credit Suisse under heightened scrutiny in the current examination. It also raises questions about the bank’s risk management practices and its adherence to regulatory requirements.

Money Laundering Ringleaders Remain Locked Up

Police initially arrested 10 people, all of Chinese origin, but with passports from various countries, for their involvement in the money laundering scheme, locking them up and denying them bail. Lawyers for the accused have reportedly begged for their release, but the attempts aren’t working.

Five of the 10 suspects appeared in court on Wednesday, and prosecutors argued that the individuals are flight risks. Despite the government seizing their assets, the government believes it’s possible they have some hidden elsewhere that no one has located. Because several of those involved had multiple passports, there’s also a fear they could use a false document to bypass border controls.

Four of the five had their bail requests rejected because of the concerns. The hearing for the fifth person was postponed until November 17 because he switched lawyers. He remains behind bars.

Comments during the hearing for one of the four, Su Jianfeng, showed how willing everyone was to participate in the scheme. Asia News Network reports he asserted that he was the CEO of a Singapore-based IT company, but admitted that he had no idea where the office is. He also acknowledged that he didn’t know what the company does.