Switzerland’s financial regulator has found a Swiss bank guilty of breaching money laundering rules in relation to the Petrobras and Odebrecht Brazilian corruption scandal. The Lugano-headquartered PKB private bank has been ordered to hand over CHF1.3 million ($1.4 million) in illicitly gained assets.
The Petrobras state oil company is at the centre of one of Brazil’s worst-ever corporate corruption scandalsexternal link. The affair has dragged in companies, banks and prosecutors from several countries, including Switzerland.
It involved a money laundering network that funneled millions of dollars in bribe money through hundreds of Swiss bank accounts, which ended up in the pockets of Brazilian politicians and Petrobras executives.
The Lugano-based PKB “had not adequately identified contractual partners and had failed to carry out appropriate background checks into high-risk business relationships and transactions,” read a statement from the Swiss Financial Supervisory Authority (FINMA) issued on Thursday. “The bank was also found to have failed in its duty to report suspected money laundering to the Swiss authorities,” the statement read.
FINMA has investigated more than a dozen Swiss banks in relation to the Petrobras scandal, launching four enforcement proceedings. In 2016, the regulator sanctioned BSI bank and Banque Heritage. Proceedings in one further case are ongoing.
In a statement, PKB welcomed the investigation’s closure, blaming the transgressions on a single rogue employee. The sanction would have “no impact on the smooth functioning of the bank”, it added.