Chitchat MAS - Lack of Courage and Candour

Its well known that senior public servants and political appointees rarely disclose events that will reflect badly on them. And making a decision also does not come naturally. It is generation that relied on one man to make the call for over 40 plus years. At stake for this generation is the well known overly high remuneration structure that acts to hold on to good people but it also holds back bad performers who will find it difficult to secure a position as well paid as their current role. Its now entrenched culture to sit tight and let the noise to go away or die down.

Here is the short background to BSI supposed closure by MAS announced yesterday. BSI was bought over by EFG International in February this year, another Merchant / Swiss Bank which has a presence in Singapore longer than BSI. The staff were already notified that jobs will go as there is no need to have 2 teams and 2 infrastructure to handle an increase in accounts. Its is pretty much a straight forward transfers of accounts and assets under one management. So why pretend to act tough and make statements when the closure was imminent without MAS doing anything. Ravi Menon could have spent more time ensuring that future currency notes do not misspell the names of iconic identities of Singapore. So we now know that this is a charade and the lack of candour an issue

Now for courage. When MAS inspected BSI in 2011, it found issues. And MAS claimed that they were rectified. In 2014, BSI was inspected by MAS again and there were more serious issues. In 2015 when the whole World came to know of 1MDB and large funds flowing thru left, right and centre, MAS made a "more intrusive" third inspection and lo and behold, they uncovered

* “multiple breaches of anti-money-laundering regulations and a pervasive pattern of non-compliance”. (from MAS)
* “blatant disregard” for monetary authority rules on compliance, and “numerous acts” (from MAS)

Its like getting call from the Fire Service notifying me that my neighbour's house has burnt down, a public service message just in case I was not aware.

So what was MAS doing all this while? And why did MAS hire a BSI staff as an Asst Director in August 2015 when it found rampant mismanagement from the very top to bottom by then. What was so special about this staff or are is MAS fansof Leo's movie To Catch a Thief.

Now this gets interesting. The bulk of BSI management staff came from Coutts Singapore. Coutts which now belongs to RBS which has been under investigation with the Swiss Authorities for sometime. In fact the shady accounts that are now the talk of the town came from Coutts presumably brought over by the same team when they moved over. The MAS Asst Director is also from the Coutts gang. There are hundreds of greats banks and with them come some great and highly experience staff. So why hire someone from entity that is already shrouded in controversy.

If MAS truly had courage, they would have referred all those who were involved in rigging the SIBOR for prosecution. Instead their respective banks sacked them only to be rehired in another bank or finance related firm. A game of musical chair if you will. UK authorities have already begun prosecution of those who fixed LIBOR and some have been convicted and gone to jail. No one has been spared including the clerks and the big boys.

So now the World knows that MAS is all fire and noise but very light touch. Is this not the ideal place to be work in when things involving foreigners are light touch. Remember the British lad, who struggled to get O level passes, who dropped his pants at the Cricket Club and also dropped the entire Simex in a hole to the tune of over a Billion dollars which then led to the bankruptcy of Barings, the Queen's Bank and one of the oldest financial institution in the World. Again poor oversight. Nick Lesson too was from Coutts.

Now the matter of Jardine Fleming and its closure. When minority shareholders of Singapore Land protested over sizeable acquisition of assets by the management, JD gave erroneous advice and valuation. It made the news. Nothing happened. When Jardine Fleming did the same thing to a Government Linked company Keppel, it was closed down real quick. I have not doubt that the management of Keppel had more clout.

Now lets go on to the episode involving Bank of Credit and Commerce in the early 90s. It had applied for a banking licences in Singapore some years earlier. MAS sat on it knowing that it had issues internationally and the Americans were making noise. When the BCCI triggered the bank run in HK and collapsed in in 1991, MAS did exactly what they did with the BSI closure and claimed that they refused to grant BCCI a licence supposedly having done their homework. What they did not say was that they did not have the courage to reject the application but sat on it until the HK affair.

Compliance and money laundering laws including KYC requirements are now pretty much templated internationally. It is nothing new. Moving $20m million at one go from account with no related history is a red flag to anyone let alone a bull. Why is this so hard to control?

From 2013:

Dear Acting Minister,

It has been almost a month since our email dated 22 Feb 2013 was sent to your kind self. And it's extremely disappointing that we have not heard from you nor your ministry to date.

We sincerely hope you are not merely paying lip service to your own pledge in Nov 2011 to ensure that Singaporeans remain the core of our workforce in companies operating here.

Being accountable for what you have said, we would like to highlight the unfair unemployment practices against Singaporeans at a Swiss Italian private bank XXX Bank. We would like to know what actions are you or your ministry going to take to rectify the situation.

1) Until the middle of last year, almost all the Heads of Department/Section in the bank’s Wealth Management Department consist of foreign Indians:

Head of WMS (Malaysian Indian)
Head of Active Advisory (India Indian)
Head of Strategic Advisory (UK Indian)
Head of Investment Strategy (India Indian)
Head of Structured Product (India Indian)

It was only in May 2012 that a local was engaged by the bank as Head of Product Strategy. And that was the result of an unfortunate event further elaborated below.

Where is the hiring and developing of a Singaporean Core the TAFEP and the government have been advocating all this time?

2) Sometime in late 2011, an anonymous complaint letter against one of the India Indians was sent to the Monetary Authority of Singapore.

Instead of launching an investigation into the India indian, the bank shockingly chose to cover up for the latter and terminated the services of 2 Singaporeans. They then created the Product Strategy to take over some of the major responsibilities held by the India Indian in an effort to minimise the damage done.

Prior to that, the Singaporean Head of WMS was forced to step down after he openly questioned the competency of the same India Indian. The Deputy CEO, another India Indian, also reduced the Singaporean's responsibilities and remuneration, and this led to his resignation.

In all, it's disheartening that 3 Singaporeans lost their jobs simply because the management chose to shield one of their own kind.

Where is the protection afforded to Singaporeans against biased senior management who use unfair hiring/firing to favour their own countrymen in this case?

3) The bank has a discriminatory hiring practice, using every opportunity to recruit foreign Indians, whenever possible, for positions within the WMS department. It is not hard to understand why, given that the Deputy CEO is an India Indian.

Some examples: In Nov 2010, the bank went all the way out to recruit an India Indian for the position of Investment Analyst in the department.

Sometime in Mar 2011, another India Indian was also employed by the bank as an Advisory Associate in the same department when all these low level positions could have easily been filled by local Singaporeans.

Even the department’s risk manager is a new Singapore citizen who was previously an India Indian.

In fact, almost half the interns in the department during 2010 and 2011 are foreign Indians. Furthermore, if you exclude the investment advisors reporting to XXX HK (but based in Singapore), more than half the advisors ranked AVP and above in the department are foreign Indians too. This is clearly unacceptable.


We completely agree with Mr. Brenton Ong's letter to the ST Forum dated 28 Feb 2013 that many Singaporeans are unhappy with the "liberal recruitment of foreign professionals, managers and executives". In fact, almost 9 out of 10 Singaporeans now support curbs on foreign workers, especially PMETs.

In a ST article dated 25 Jan 2013, the Prime Minister was quoted as saying the PAP government is on the side of Singaporeans. Is it really true... then why are there so many foreigners performing jobs that can be easily filled by locals?

And in many cases, the foreign talent are not as "talented" as what the government paints them to be. They are simply here at the expense of Singaporeans, taking advantage of the government's lax pro foreigner policies.

As such, the PAP government especially the Ministry of Manpower must be held fully accountable (to what they have said) by investigating and penalizing firms with discriminatory employment practices and hiring/firing policies. Otherwise, we should vote for somebody else who can protect Singaporeans' jobs. Thank you.

@Pinkieslut <From 2013:

Dear Acting Minister,

It has been almost a month since our email dated 22 Feb 2013 was sent to your kind self. And it's extremely disappointing that we have not heard from you nor your ministry to date.>


Tharman Shanmugaratnam, FINANCE MINISTER, 1 December 2007 to 30 September 2015, local Indian, the PPM that many knowledgeable
Alfrescians pin their hope on to rescue this little red dot, frankly I do not believe that he could do it, LOL!

MAS staff itself needs to be inspected too. Did we not hear couple of them were in the panama paper leaked?

myfoot123 said:

MAS staff itself needs to be inspected too. Did we not hear couple of them were in the panama paper leaked?

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What was in the leaks that showed that any MAS staff had broken the law?

He didnt say charge them...he said for them to be investigated.

Leongsam said:

What was in the leaks that showed that any MAS staff had broken the law?

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Alamakinky said:

He didnt say charge them...he said for them to be investigated.

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"investigate" is like getting workers to a field with tall overgrown grasses with butterfly nets to catch rats that had infested the field. The "investigator" will catch a few, slow, moving lazy or even old ones....the rest will either would have scurried or burrowed away to safety.

That is call "investigated"....if they really mean business....to get rid of the infestation....they would burn the field......

It is well known that Spore is in the laundry business. The only reason they are acting against this bank is probably because the Swiss are already investigating & all the bad publicity that has already been created

It's all wayang lah

Screwballs, name the source of the first post. i know u didn't write it.

johnny333 said:

It is well known that Spore is in the laundry business. The only reason they are acting against this bank is probably because the Swiss are already investigating & all the bad publicity that has already been created

It's all wayang lah

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Of course it is no coincidence that this news comes after the conclusion of the Sarawak elections....

BSI was creature that was identified nearly 9 years ago by the US authorities. It main customer base are rich Italians who have hidden their wealth with BSI Switzerland. It was sold twice in the last 2 years. Nothing about BSI is new. MAS could easily have issued a show-cause letter to the Sr Management in Switzerland and stopped it from acquiring new accounts in 2015. Nothing. Zilch.

scroobal said:

BSI was creature that was identified nearly 9 years ago by the US authorities. It main customer base are rich Italians who have hidden their wealth with BSI Switzerland. It was sold twice in the last 2 years. Nothing about BSI is new. MAS could easily have issued a show-cause letter to the Sr Management in Switzerland and stopped it from acquiring new accounts in 2015. Nothing. Zilch.

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If you were an Italian paying Italian taxes into a system that is rotten to the core you'd be hiding your wealth too.

Here is the interesting part. The same smart Italians began withdrawing their money from BSI because they found out that the Bank was having internal compliance and will lead to a bigger mess. When their core base began eroding they sold it to the Brazilians. Ravi of all people should know this as he was based in Basel with BIS which handles international transfers and settlements and familiar with the territory.

Leongsam said:

If you were an Italian paying Italian taxes into a system that is rotten to the core you'd be hiding your wealth too.

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scroobal said:

Here is the interesting part. The same smart Italians began withdrawing their money from BSI because they found out that the Bank was having internal compliance and will lead to a bigger mess. When their core base began eroding they sold it to the Brazilians. Ravi of all people should know this as he was based in Basel with BIS which handles international transfers and settlements and familiar with the territory.

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http://velonews.competitor.com/2016/05/news/the-fall-and-rise-of-italian-cycling_403813

Paolo Bettini, the rambunctious, two-time world champion, still cuts a lean figure at 41. Nicknamed “Grillo” (meaning “cricket,” an ode to the manner in which he would bounce around the peloton), Bettini is always smiling, except when you ask him about the current state of cycling in Italy.

“Why is Italian cycling struggling? Taxes are too high,” Bettini explains with a shake of his head. “To find a sponsor in Italy, they must pay too much to the government. So if a sponsor pays $10 million, less than half goes to the team after the government takes its share. We have a joke in Italy: ‘You work eight months for the country, and four months for your family.’ And it’s like that in cycling.”

Bettini has firsthand knowledge of how challenging it can be. In late 2013, he quit his job as Italy’s national coach to partner with Formula 1 driver Fernando Alonso in an ill-fated effort to launch a new WorldTour team. When that idea fizzled, he began sniffing around Italy for new sponsors, but without luck.

“La crisi,” Bettini says, cursing the crisis in Italian. “It’s killing Italian cycling.”

Leongsam said:

http://velonews.competitor.com/2016/05/news/the-fall-and-rise-of-italian-cycling_403813

Paolo Bettini, the rambunctious, two-time world champion, still cuts a lean figure at 41. Nicknamed “Grillo” (meaning “cricket,” an ode to the manner in which he would bounce around the peloton), Bettini is always smiling, except when you ask him about the current state of cycling in Italy.

“Why is Italian cycling struggling? Taxes are too high,” Bettini explains with a shake of his head. “To find a sponsor in Italy, they must pay too much to the government. So if a sponsor pays $10 million, less than half goes to the team after the government takes its share. We have a joke in Italy: ‘You work eight months for the country, and four months for your family.’ And it’s like that in cycling.”

Bettini has firsthand knowledge of how challenging it can be. In late 2013, he quit his job as Italy’s national coach to partner with Formula 1 driver Fernando Alonso in an ill-fated effort to launch a new WorldTour team. When that idea fizzled, he began sniffing around Italy for new sponsors, but without luck.

“La crisi,” Bettini says, cursing the crisis in Italian. “It’s killing Italian cycling.”

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But in Stinktothecore.....the government is clean they don't take from the people....it is the people, who gladly GIVE to the government....that is the beauty....it is not a joke here that, you work for the government 12 months in year...

See our local media report, no clue what had happened. Zero-tolerance? They tolerated it for over 2 years.

http://www.todayonline.com/business...zero-tolerance-towards-abuse-financial-system

BSI Bank shutdown ‘shows zero tolerance towards abuse of financial system’

BY
RUMI HARDASMALANI
[email protected]ISHED: 4:15 AM, MAY 25, 2016UPDATED: 9:36 AM, MAY 25, 2016
SINGAPORE — The Monetary Authority of Singapore’s (MAS) order to close down BSI Bank sends out a strong message to banks and financial institutions operating in the Republic that it has a zero-tolerance policy towards those abusing the financial ecosystem here, industry experts said yesterday.

MAS revoked BSI Bank’s merchant banking licence in Singapore for serious breaches of anti-money-laundering rules amid a global probe into the accounts of Malaysian state investment fund 1MDB. It also imposed fines on the lender amounting to S$13.3 million.

CIMB Private Bank economist Song Seng Wun said: “It is not an ordinary day for banks and financial institutions at the financial hub in the region. They have been reminded yet again, albeit most firmly in decades, that they need to put to action their anti-money-laundering obligations and that there is no respite for those not falling in line with the rules of the country.”

Mr Nizam Ismail, head of regulatory practices in Singapore and co-founder of compliance solutions at law firm RHTLaw TaylorWessing, said: “This will send a chilling message to bankers here, pushing them to ensure robust anti-money-laundering and counter-terrorism-financing strategies are at play, as otherwise the risk of losing their regulatory licences is now more pronounced. Worse of all, there is also the real threat of personal criminal liability.”

MAS is working with the Swiss authorities to ensure an orderly shutdown of BSI Bank’s operations in Singapore. While industry experts said there will be no big impact on BSI Bank’s clients in general, those found involved in illicit monetary transactions will be taken to task.

“Chances are rare that there would be any significant impact on BSI’s clients here or that anyone would be left in the lurch, as MAS would have sorted this out with BSI before making the announcement,” said Mr Nizam.

Veteran market watcher Mano Sabnani said the problems at BSI are not likely to be contagious.

“It is probably the main rotten egg and the entire basket is not necessarily contaminated. The ramifications as such will be well contained. But MAS will successfully extract from BSI details of its clients who are at fault and will go after them. After all, clients are the source of money,” he said.

In the past five years, rules surrounding tax reporting and anti-money-laundering have been tightened in Singapore and globally.

While this has resulted in increased costs in compliance and surveillance, Ms Tan Su Shan, the co-chair of MAS’ Private Banking Industry Group, said it is better for all industry players in the long run as standards are lifted across the board.

“For us in Asia, what is helpful is that the region is still growing and creating wealth, so business momentum remains positive. Banks who have the scale, knowledge, platform, talent and depth of relationships will continue to benefit from this trend of rising affluence and wealth creation,” said Ms Tan.

Singapore prides itself as a clean and trusted financial centre based on solid regulations. To continue to grow as a robust and sustainable financial hub, she said industry players must recognise that they play an important role to guard against illicit funds flows.

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The sacrificial lamb stands ready. The fire is burning and the knife is being sharpened.

http://www.channelnewsasia.com/news/singapore/2-new-charges-for-ex-bsi/2811964.html

SINGAPORE: Two additional charges were levelled against former private banker Yeo Jiawei, who has been accused of money laundering and cheating offences allegedly linked to a probe into Malaysia's troubled state fund 1MDB, on Tuesday (May 24).

The 33-year-old now faces a total of nine charges, including that for money laundering and cheating involving millions of dollars, and for perverting the course of justice.

His latest charges are for allegedly concealing a portion of the fees he received from deals between his employer, Switzerland's BSI Bank, with two companies, Pacific Harbor Holdings (PHH) and Devonshire Capital Management (DCM). He is accused of receiving part of the fees through Bridgerock Investment, an entity owned by himself, for the deals that took place in 2013 - thereby inducing BSI to enter into the agreements with PHH and DCM on Aug 28, 2013 and Feb 21, 2013 respectively.

BSI Bank was separately shut down by the Monetary Authority of Singapore on Tuesday over “serious breaches of anti-money laundering requirements, poor management oversight of the bank’s operations, and gross misconduct by some of the bank’s staff”.

In court on Tuesday, Second-Solicitor General Kwek Mean Luck urged the court to deny Yeo bail, saying this is the first time a bank has been shut down in Singapore and that the prosecution believes Yeo “is central to the activities that have led to MAS’ response”.

Mr Kwek highlighted Yeo’s "significant" role in masking the nature of illicit financial transactions and argued that there is an immediate risk that he will tamper with witnesses. “Releasing him on bail will jeopardise ongoing investigations, and (also) investigations into other individuals named (by) MAS”, he said.

Yeo’s lawyer Harry Elias called his client’s 38-day remand “simply unacceptable”. It is the longest time any single accused person has been remanded for an investigation Mr Elias said. He accused the prosecution of attempting to prolong Yeo’s remand by tendering fresh charges against him in piecemeal fashion and said the two additional charges for cheating brought against Yeo are “nothing new”. Tuesday marks the fourth time Yeo has faced new charges since he was remanded in April this year.

Mr Elias suggested a bail amount of between S$200,000 to S$400,000 for Yeo, stressing that his client is extremely unlikely to abscond, seeing as he is married with a young daughter, and that is entire family is Singaporean. Yeo’s passport has also been in police custody since last October.

The prosecution, led by Mr Kwek, said the defence’s response “overly dramatizes” the situation.

“The reason why we’re taking these unusual steps is because Yeo himself as taken very unusual steps”, Mr Kwek told the court. “In most cases, you do not have an accused person who is actively tampering with witnesses”, he added, revealing that Yeo has interfered with at least five witnesses so far.

Yeo’s immediately family is also being investigated for money laundering offences.

District Judge Christopher Goh is expected to decide on Yeo’s bail application on Thursday afternoon.

I am told that despite he being the most junior within the six bank staff identified, this guy was controlling the show for 1MDB in BSI and the seniors were scared of him. He is only 33. And even more remarkable is that he actually cheated the bank as well. Jho Lo appears to have to done the same thing with junior staff in 1 MDB and the Malaysian Banks where junior staff have been involved. Nevertheless, the seniors made millions in commission and did not do the job.

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aurvandil said:

The sacrificial lamb stands ready. The fire is burning and the knife is being sharpened.

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scroobal said:

I am told that despite he being the most junior within the six bank staff identified, this guy was controlling the show for 1MDB in BSI and the seniors were scared of him. He is only 33. And even more remarkable is that he actually cheated the bank as well. Jho Lo appears to have to done the same thing with junior staff in 1 MDB and the Malaysian Banks where junior staff have been involved. Nevertheless, the seniors made millions in commission and did not do the job.

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This is the all so familiar of "finding a scapegoat"...you can bet that the JUNIOR would have stash his 'loot' & distributed somewhere a long time ago & it will most likely that it will take "52 man years" to uncover....bet, LEESON....is living off, some "stash"..

The lamb never knew why he was being fattened. He had always assumed that he enjoyed the best because he was so much cleverer than his peers.

scroobal said:

I am told that despite he being the most junior within the six bank staff identified, this guy was controlling the show for 1MDB in BSI and the seniors were scared of him. He is only 33. And even more remarkable is that he actually cheated the bank as well. Jho Lo appears to have to done the same thing with junior staff in 1 MDB and the Malaysian Banks where junior staff have been involved. Nevertheless, the seniors made millions in commission and did not do the job.

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