Mr Raj Sriram, former Deputy CEO and Head of Private Banking of BSI Bank Limited, Singapore Branch (BSIS), has been issued a 24-month conditional warning from the Singapore Police Force’s Commercial Affairs Department (CAD) and a 10-year prohibition order (PO) by the Monetary Authority of Singapore (MAS) for his contribution to BSIS’ failure to file suspicious transaction reports (STRs) regarding 1Malaysia Development Berhad (1MDB)-related transactions. 2. CAD investigated Mr Sriram in relation to his role in BSIS’ business dealings and relationships with the subsidiaries of 1MDB and Aabar Investments PJS Limited, the purported subsidiary of the Abu Dhabi-based Aabar Investments PJS. CAD found that there were reasonable grounds for BSIS to file STRs in respect of 1MDB related transactions, as required under MAS’ Notice 1014 on the Prevention of Money Laundering and Countering the Financing of Terrorism – Merchant Banks. Due to Mr Sriram’s neglect, BSIS did not file the STRs. 3. After careful consideration of the circumstances of the case and in consultation with the Attorney-General’s Chambers, CAD issued a conditional warning in lieu of prosecution to Mr Sriram for two offences under section 28B(1) read with section 27B(2) of the Monetary Authority of Singapore Act (MAS Act). Under the conditional warning, Mr Sriram –
paid a sum of $150,000 to the Singapore Government’s Consolidated Fund; and
committed to (i) refrain from criminal conduct for a period of 24 months; (ii) continue to cooperate with CAD in its 1MDB-related investigations; and (iii) not accept any directorship positions or positions of similar substance or form for a period of four years from 6 September 2021.
4. Further to CAD’s conditional warning, MAS performed a review of Mr Sriram’s conduct as a former regulated representative during his term at BSIS. MAS assessed that Mr Sriram’s conduct warranted a 10-year PO as he held a senior position at BSIS and his neglect had contributed to BSIS’ failure to file the STRs.
5. The PO, which took effect on 10 October 2022, prohibits Mr Sriram from providing any financial advisory service or taking part in the management of, acting as a director of, or becoming a substantial shareholder of, any financial advisory firm under the Financial Advisers Act.
6. The authorities take a serious view of compliance with anti-money laundering (AML) and countering the financing of terrorism (CFT) laws, and reporting of STRs.
7. Ms Ho Hern Shin, Deputy Managing Director (Financial Supervision), MAS, said, “BSIS, of which Mr Sriram was Deputy CEO and Head of Private Banking, was a key conduit for tainted funds in the 1MDB debacle. MAS withdrew BSIS’ licence in May 2016 due to serious and repeated breaches of AML/CFT requirements. The ultimate responsibility for ensuring a financial institution’s compliance with AML/CFT laws and regulations rests with its board of directors and senior management. MAS will take to task errant board and senior management members whose failures result in their financial institutions violating laws and regulations.”
8. Mr David Chew, Director of CAD, said “The suspicious transaction reporting regime is a key pillar of Singapore’s approach to anti-money laundering and countering the financing of terrorism. The Singapore authorities take a serious view of the obligation to file such reports, and strongly urge reporting entities to remain vigilant in detecting and reporting suspicious transactions. Officers of a financial institution are responsible for upholding the STR regime. The Singapore authorities will not hesitate to take firm action against reporting entities or their officers, who intentionally or negligently fail to file suspicious transaction reports when legally obliged to do so.”
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Additional information (A) Section 27B(2) of the MAS Act Section 27B(2) provides that a financial institution is guilty of an offence if it fails to comply with an MAS issued direction. (B) Section 28B(1) of the MAS Act Section 28B(1) provides that if an offence by a body corporate under the MAS Act is proved to have been committed with the consent or connivance of, or attributable to the neglect of an officer of that body corporate, the officer and the body corporate shall be guilty of that offence and can be punished accordingly. (C) 24-month conditional warning Should Mr Sriram commit any fresh offence within the 24-month period or fail to abide by the conditions stated at Paragraph 3, he may be prosecuted for both the fresh offence and the two offences under section 28B(1) read with section 27B(2) of the MAS Act.
