Last month, we learned that JPMorgan Chase had managed the near-impossible and run afoul of Swiss banking laws, specifically Switzerland’s not-historically-robust anti-money-laundering rules. How bad was Dimon & co.’s transgression? The Swiss were initially awfully Swiss about things, simply letting the bank know it had “seriously infringed” upon their financial hospitality.
Yesterday, that prognosis was upgraded to “seriously breached.” So seriously that a traditional slap on the wrist will not do. No: The Swiss are gonna get all American up in here and install a monitor to make sure it doesn’t happen again, “it” being the gentle washing of “hundreds of millions of dollars” on behalf of the prime minister of Malaysia, who was in the process of allegedly draining that country’s sovereign wealth fund, 1MDB, of several billion dollars.
According to Finma, JPMorgan’s Swiss unit helped several individuals tap into the fund, transferring “hundreds of millions of dollars” that were meant to be used for 1MDB’s purchase of a company to the personal account of someone tied to a 1MDB business partner. The bank then sent some of the money to another company associated with that person.
“The bank questioned neither the economic purpose of the transactions, the procedure involved, nor the substantial amount that remained in the personal account,” Finma said.