Singapore has banned a bank from operating because of "gross misconduct" and AML lapses, the first time a merchant banking licence has been revoked since 1984.

EFG
EFG International has further taken note of FINMA’s and MAS' press releases in connection with the BSI related 1MDB matter," EFG International said in a statement today.

"The share purchase agreement with BTG Pactual has an indemnity in relation to these and certain other matters up to the overall purchase price. It was agreed in the share purchase agreement that the indemnity will be backed by a material Swiss escrow account which, at closing, will contain 51.0 milion EFG shares issued to BTG as consideration, with shares locked up for two years. The fine and the penalty will result in a reduction in the purchase price. The indemnities and escrow account remain unchanged," it said.

EFG believes that these developments will draw a line, from a Swiss and Singaporean regulatory standpoint, with the past in connection with this matter and constitute another important step to remove related regulatory uncertainty for clients, employees, investors, and other stakeholders.

1MDB statement
1Malaysia Development Berhard, to give 1MDB’s full name, said today that it “notes the media statements issued today by lawful authorities in Switzerland and Singapore”.

“1MDB states that it has not been contacted by any foreign lawful authority on matters relating to the company. 1MDB remains committed to fully cooperating with any foreign lawful authority, subject to advice from the relevant domestic lawful authorities, and in accordance with international protocols governing such matters. 1MDB confirms that its ownership of various fund investments has not been impacted by the announcements today.”

The organisation has consistently denied claims of wrongdoing, such as that it has allowed funds to be siphoned off by political figures and other individuals.

Swiss action
The Office of the Attorney General of Switzerland said it has has opened criminal proceedings against the BSI bank, saying it has decided to act based on information revealed by the criminal proceedings in the 1MDB case as well as by issued raised via FINMA, the Swiss regulator.

“The OAG suspects deficiencies in the internal organisation of the BSI SA bank,” it said. “It is believed that due to these deficiencies, the bank was unable to prevent the commission of offences currently under investigation in the criminal proceedings relating to 1MDB,” it said.

“Swiss law (Art. 102 para. 2 of the Swiss Criminal Code, SCC) allows the prosecution of a company that is suspected of not taking all the reasonable organisational measures that are required to prevent third parties from committing offences, and in particular money laundering or corruption offences,” it said.