Swiss Begin Enforcement Proceedings Against Banks Over Petrobras

  • Finma found deficiencies in banks' money-laundering measures
  • Swiss regulator did not name three Swiss banks involved

Switzerland’s finance regulator has begun enforcement proceedings against three Swiss banks over shortcomings in their anti money-laundering provisions that exposed them to a widening corruption scandal surrounding Brazilian oil producer Petrobras Brasileiro SA.

Finma, as the regulator is known, said Tuesday in an e-mailed statement that enforcement measures began in September but did not name the three banks or say how long those proceedings will take to complete.

The corruption scandal surrounding the Rio de Janeiro-based oil and gas producer has dented investor confidence in Brazil and triggered calls for Brazilian President Dilma Rousseff to be impeached over her handling of the affair.

The Swiss Attorney-General’s office said in March it had uncovered more than 300 accounts belonging to senior Petrobras executives and its suppliers at over 30 banking institutions used to “process bribery payments.” The Swiss at the time released $120 million of $400 million in assets tied to suspicious Petrobras-related transactions that had previously been frozen.

Finma, based in the Swiss capital Bern, has beefed up its money-laundering ordinance that will take effect on Jan. 1 to tighten restrictions on cash transactions and force greater disclosure on financial intermediaries. Though Finma cannot lay criminal charges, it does have the power to levy fines, through the disgorgement of profits, and suspend or even ban a bank or individual from working in Switzerland.

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