The embattled and controversial Malaysian sovereign fund 1MDB is now in the limelight of an investigation by Solomon Hughes on UK’s Conservatives Party-run private banking company, Coutts.
Coutts has got many fines from financial regulators around the world, is a British bank run by Tory lords and Conservative ex-ministers.
It has been repeatedly fined for involvement in what US officials called an “international public corruption and a global money-laundering conspiracy.”
But the fines have been imposed by Swiss, Hong Kong and Singaporean regulators — British authorities seem unable to deal with Coutts’s misbehaviour, said Morning Star Online.
The Financial Conduct Authority (FCA) might be nervous about taking on Coutts because it has strong ‘Establishment’ links.
Which shows the extend of the cover up of the scandalous 1MDB affair, hiding behind Lords in the UK, behind actors and movie makers in the USA, and not to forget behind an elusive figure known as Jho Lho (real name Low Taek Jho).
From the start, it was clear the 1MDB scandal was global, and that it was a massive jigsaw puzzle that would be difficult to decifer.
Coutts is currently chaired by Tory lord and former Conservative government minister William Arthur Waldegrave, aka Baron Waldegrave of North Hill who joined the Coutts board in December 2012.
Conservative Lord David Alexander Cospatrick Douglas-Home, aka the 15th Earl of Home, was Coutts chairman from 1999 to the end of 2013.
Douglas-Home also happens to be the son of a former Tory Prime Minister, Alec Douglas-Home.
Coutts’s links to the top of British society are so strong that they hold the Queen’s bank account, said Morning Star.
Coutts fines relate to the Malaysian 1MDB affair, one of the biggest world scandals in banking.
Malaysian Prime Minister Najib Razak set up a huge government fund called 1MDB in 2009 to fund development projects in his country.
An investigative website called Sarawak Report charged that billions were flowing from this public fund into the private bank accounts of the Malaysian PM’s associates. Instead of helping develop Malaysia, the fund was making politicians rich.
The US Department of Justice agreed, launching lawsuits in July 2016 to recover billions missing from the public 1MDB fund in what they called an “international public corruption and a global money-laundering conspiracy” by a “kleptocracy” connected to the Malaysian PM.
According to US charges, huge bundles of 1MDB cash were siphoned out of the public fund and into the hands of Razak’s friends and other political insiders.
The Americans say public 1MDB money bought mansions in London and New York for these insiders.
The money was also ironically used to fund the film The Wolf of Wall Street.
Political insiders enriched themselves by investing in a film about financial corruption.
The US did not charge Coutts for corruption, but their charge documents do say $2 billion of 1MDB cash moved through Coutts accounts controlled by Jho Low, the elusive Malaysian businessman and playboy close to the Malaysian PM between 2009 and 2013.
This February, Swiss regulator Finma fined RBS Coutts 6.5 million Swiss Francs (about £5 million) for breaking money laundering rules in transactions involved in the “alleged corruption scandal involving the Malaysian sovereign wealth fund 1MDB.”
The Swiss regulator says “internal warnings were ignored” over $1.7bn transfers from 1MDB accounts to those of a “young Malaysian businessman,” a description that could match Low, though he hasn’t been named.
Coutts staff told their Compliance Unit they “feel very uncomfortable with this guy and the transactions that are going through the account.
Crucially, from a British perspective, in the summer of 2012 and 2013, further 1MDB-related transfers of $680m were made in and out of Coutts accounts linked to the questionable Malaysian businessman.
That’s after the British FCA fined Coutts £8.7m for breaking money-laundering rules relating to “politically exposed persons.” Coutts promised the FCA in March 2012 they would stop these “serious, systemic” failings. But the Swiss 1MDB fine suggests they did not.
“Politically exposed persons” means super rich people who either are, or who have links to, top politicians. Paying special attention to “politically exposed persons” is central to fighting corruption.
Switzerland’s Finma says it passed details of the case to the British FCA. But as yet the FCA has taken no action against Coutts, even though it seems the bank broke its 2012 promises to do better.
Other international regulators have fined Coutts over 1MDB.
Coutts is part of the Royal Bank of Scotland group. Thanks to the bank bailout following the financial crash, Coutts and Royal Bank of Scotland have been publicly owned since 2008. Much of their dubious 1MDB work happened after this date.
This is how the banks repay us for bailing them out? They employ a bunch of ex-Tory ministers at the top, while embroiling the bank in what US officials called an “international public corruption and a global money-laundering conspiracy” on behalf of a “kleptocracy.”