US fines a Swiss private bank for processing millions of dollars for Cuban clients

He banking group Swiss private EFG International AG agreed to pay about $3.7 million penalty fee to the US Office of Foreign Assets Control (OFAC) for violating several Washington sanctions programs, including sanctions against the Cuban regime And Russia.

According to the US unit, the Swiss bank, which operates about 40 global subsidiaries, bought and sold securities on behalf of those sanctioned by OFAC.

The amount of $3,740,442 to be paid will allow EFG to resolve its potential civil liability for violations committed between 2014 and 2018. During that period, the bank had American securities firms process 727 transactions from customers in Cuba for a total of $29,939,701.

Additionally, the banking unit processed 141 securities-related transactions for a total of $468,615 for an individual blocked under the kingpin law, which bans drug traffickers and organizations associated with drug trafficking, while in 2023 it processed five transactions with a combined value Processed dividend payments. of $1,200 for securities in U.S. custody of an individual blocked under Executive Order 14,024 of the OFAC Moscow Sanctions Program.

EFG’s subsidiaries and affiliates provide financial services including banking, investing, asset management and securities to institutional clients and individuals around the world. OFAC said in its statement that the approved transactions were conducted through omnichannel accounts supervised by the US market, including EFG’s US subsidiary.

According to the settlement statement, between January 2014 and July 2018, EFG subsidiaries based in the Bahamas, Cayman Islands, Luxembourg, Monaco and Switzerland processed 727 securities-related transactions and Fund transfers involving US market participants, including EFG Miami, on behalf of clients resident in Cuba or whose ultimate beneficiaries were Cuban citizens.

Too, EFG clients also include a Panamanian company based in Cuba and owned by one person.Two private investment companies based in the British Virgin Islands and Panama, whose beneficial owner was another Cuban citizen and resident, and persons about whom EFG had reason to know were not in compliance with the residence documents provided to their respective subsidiaries. Lived in Cuba on base.

The OFAC statement did not specify the names of the companies and individuals.

In the case of 404 of these transactions, executed on behalf of a family that included Cuban residents, EFG engaged EFG Miami as the intermediary. Securities transactions include the purchase, sale or redemption of securities positions that EFG acquired for those clients.As well as corporate actions, such as interest payments or dividend distributions.

OFAC determined that EFG did not take proper precautions or care, by failing to adequately select and timely notify US custodians and other parties in the US about the status of individuals blocked in omnibus accounts.

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