Swiss regulator investigates 12 banks in Lebanese central banker corruption case (updated)

EFG International AG

27/02/2023 15:49

(Updates banks' responses in final three paragraphs)
       ZURICH, Feb 27 (Reuters) - Switzerland's financial
regulator has investigated 12 banks and launched enforcement
proceedings against two of them in relation to corruption
charges against longtime central banker Riad Salameh, it said on
Monday.
    Lebanese authorities charged Salameh, his brother Raja and
one of his assistants on Thursday with money laundering,
embezzlement and illicit enrichment after months of delay in the
high-profile case. 
    The Salameh brothers have denied wrongdoing throughout the
process. The governor insisted on his innocence to Reuters last
Thursday, saying the charges were "not an indictment" and
pledged to abide by judicial procedures.
    The charges are the product of an 18-month probe by Lebanon
into whether Salameh and his brother Raja embezzled more than
$300 million from the Central Bank between 2002 and 2015.
    The Swiss Financial Market Supervisory Authority (FINMA) on
Monday said it has investigated 12 banks in relation to
allegations of money laundering linked to the case.
    "In the context of Lebanon, FINMA carried out investigations
at approximately a dozen banks," a spokesman said. "In two
cases, FINMA opened enforcement proceedings."
    Enforcement proceedings occur when FINMA detects failures at
a bank and works to establish what has gone wrong and what
measures need to be taken to prevent breaches of money
laundering regulations in future.
    In serious cases FINMA can impose measures on banks and also
refer matters to the Swiss federal prosecutors if criminal
breaches are suspected.
    FINMA declined to comment on the nature of the enforcement
proceedings in this case, or the banks involved.
    The Salameh brothers are alleged to have transferred $330
million to Swiss accounts via the offshore company Forry
Associates, which is registered in the British Virgin Islands,
Swiss newspaper SonntagsZeitung newspaper reported.
    Substantial sums were used to purchase real estate in
several European Union countries, it said.
    Some $250 million went into Raja Salameh's personal account
at the HSBC branch in Geneva, the newspaper said. Other sums
were deposited at UBS, Credit Suisse, Julius Baer, EFG and
Pictet, it added.
    Julius Baer, UBS, HSBC and Credit Suisse declined to comment
to Reuters, while the other two banks mentioned in the report
did not respond to a request for comment.
    Swiss foundation Accountability Now had filed complaints
with FINMA against Bank Audi, BankMed, HSBC and Julius Baer in
connection with alleged financial crimes committed by Salameh.
    Bank Audi Suisse declined to comment on Monday, while
BankMed Suisse did not immediately respond.

 (Reporting by John Revill; additional reporting by Maya Gebeily
in Beirut Editing by Sharon Singleton)
 ((John.Revill@thomsonreuters.com; +41 41 528 36 37; Reuters
Messaging: john.revill.thomsonreuters.com@reuters.net))