Chinese Dirty Money Probe Extends To UBS As Credit Suisse Goes Under The Spotlight Of Singapore Regulators

Credit Suisse AG has become the target of another money-laundering probe, this time by the Singapore authorities, just months after being taken over by rival UBS Group AG UBS and following a similar DOJ investigation, according to a Bloomberg report.

The investigation has so far yielded around S$2.8 billion ($2 billion) in seized assets. It is being carried out by the Monetary Authority of Singapore (MAS), the country’s regulator, and has focused on Chinese nationals laundering money through private banks in the city-state.

As part of that effort, regulators found that the Swiss bank was the repository for S$92 million, the largest amount of cash held by a single account holder called Vang Shuiming.

The investigation raises questions about the bank’s potential status as a safe-haven for dirty money around the world, in particular with respect to politically-sensitive actors and comes at a tumultuous time for UBS’ Asia-Pacific division.

The probe in Singapore mirrors a separate year-long ongoing investigation into UBS and Credit Suisse by the Department of Justice (DOJ) over whether the banks purposefully evaded Russian sanctions. Credit Suisse and UBS are two of the largest global banks that did business with Russian clients, according to reports, with Russian cash holdings of around $20 billion and $33 billion, respectively.

As for other banks, UBS has been the beneficiary of rising rates this year, rising 32% year-to-date but has dipped a bit in recent weeks as a result of increasing pressure by the US DOJ on the firm over the Russian money laundering case.

This latest Chinese money laundering probe, which has made front-page news in Singapore, poses a further risk to the bank’s fragile global relationships as it grapples with the messy process of integrating two sprawling operations.

In March, Credit Suisse was taken over by UBS in a 3 billion CHF ($3.2 billion) fire-sale brokered by the Swiss government.

As a result of that merger, Credit Suisse recently lost 6 of its highest-ranking executives across the Asia Pacific region who service its client base of entrepreneurs, ultra-high net worth accounts and institutions. Among Credit Suisse’s largest customers in the region is Vingroup JSC, the parent company of VinFast Auto Limited VFS, according to Bloomberg.