DFSA slaps $3m fine on Mirabaud for AML failings
The Dubai Financial Services Authority (DFSA) has slapped a $3 million fine on bank Mirabaud (Middle East), a division of Swiss banking and financial services group Mirabaud, citing inadequate anti-money laundering (AML) controls.
DFSA slaps $3m fine on Mirabaud
Between June 2018 and October 2021, the regulatory body says it found that due to weaknesses in Mirabaud’s AML systems and controls, it processed transactions for a group of nine interconnected client accounts managed by the same relationship manager, with suspicions of money laundering.
The DFSA claims the activities of the accounts “exhibited characteristics similar to those commonly seen in the layering phase of a money laundering operation”. While it did not make any finding on whether any of the transactions were indeed money laundering, it says the activities highlighted “significant weaknesses” in Mirabaud’s AML systems and controls.
It claims the bank, despite having its own policies and controls in place, failed to consider the customer information it held while processing transactions for them, leading it to process significant volumes of transactions for those customers for over three and a half years, despite the transactions being inconsistent; out of expected activity; and for purposes prohibited under its own policies.
The relationship manager in question has since left Mirabaud, and so have the individuals who held the roles of senior executive officer and chief compliance officer during the stated period.
“By failing to ensure that its AML systems and controls were effective, Mirabaud did not recognise clear indicators of potential money laundering or take the appropriate action when it had concerns about customers’ activity,” says Ian Johnston, chief executive of the DFSA.
“The level of penalty imposed on Mirabaud reflects the importance of AML compliance in maintaining confidence in the integrity of the DIFC.”
Since the bank agreed to settle the matter, the fine was reduced from an initial $3.9 million.
