Monday, 3 September 2012

SWISS PROBE UBS OVER MONEY-LAUNDERING





SWISS prosecutors have opened a criminal money laundering probe into UBS after an environmental campaign group filed a complaint accusing it of links to the proceeds of alleged illegal logging in Malaysia.

The investigation could be a new embarrassment for the Swiss bank, fined for helping clients dodge U.S. taxes in 2009 and facing similar accusations - which it denies - in Germany. It comes as Switzerland is trying to clean up its image as a haven for ill-gotten gains.

A spokeswoman for federal prosecutors said they had opened a criminal investigation into allegations of money laundering.

She confirmed that UBS was being investigated in connection with its relationship with Musa Aman, chief minister of Malaysia's Borneo state of Sabah.

He was accused in the complaint brought by Switzerland's Bruno Manser Fund in May of links to illegal logging in Borneo. He did not respond to phone calls, but has previously dismissed graft allegations as a political conspiracy.

UBS said it was cooperating with the investigation.

"UBS complies with the rules and regulations in all the markets where it operates," a spokesman said, noting the bank is obliged to report to authorities fighting money laundering if it finds evidence it is holding assets of criminal origin.

In its complaint, the Bruno Manser Fund, which campaigns to save tropical rainforests in Borneo and the people who inhabit them, accused UBS of breaching its duty of care by accepting more than $90 million it said was earned from logging in Sabah. Citing documents it presented to Swiss prosecutors, it said the money was banked at UBS in Hong Kong and Zurich.

(Reuters: Reporting by Katherina Bart in Zurich and Niki Koswanage in Kuala Lumpur; Editing by Matthew Tostevin)

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