UBS Strengthens AML Checks on Wealthy Clients in Asia

UBS Group AG is intensifying scrutiny of how clients in its Asian wealth hubs make and move their money, pressing some to provide more detailed disclosures as the Swiss lender looks to avoid fresh regulatory clashes.

People familiar with the matter told Bloomberg that UBS has engaged Deloitte and KPMG to help review client documentation for signs of illicit activity, including potential money laundering. In some cases, the queries reach back more than a decade to legacy, even handwritten, records.

The effort has focused primarily on clients in Singapore and, to a lesser degree, Hong Kong, and comes as the island-nation continues to ramp up its regulatory enforcement efforts in the wake of a S$3 billion (USD $2.3 billion) money-laundering scandal involving local and multinational banks, Bloomberg said.

Already this year Singaporean authorities have levied S$27.5 million in penalties on nine firms for anti-money-laundering lapses, including the local units of UBS and Citigroup. Credit Suisse’s Singapore branch drew the largest single penalty at S$5.8 million.

UBS’s compliance posture also reflects a broader effort to put legacy legal issues behind it, the report said. In September, the bank ended a long-running French tax case by agreeing to pay €835 million (US$974 million) in fines and damages.

For now, the bank’s message to wealthy clients in Asia is clear: expect deeper source-of-wealth and source-of-funds checks, and be ready to document them, no matter how old the relationship.