But says its policy is to cooperate fully
with authorities
The
Swiss bank UBS, at the center of allegations of money laundering by Sabah’s
chief minister Musa Aman, said it couldn’t comment on the claims although a
spokesman for the bank said UBS is fully committed to assisting in the fight
against money laundering.
“UBS
does not comment on market speculation or rumor,” Mark Panday, a spokesman for
the bank’s operations in Hong Kong, told Asia Sentinel. “However, in all
markets in which it operates, UBS’s policy is to cooperate fully with
regulators. Indeed, it is committed to assisting in the fight against
money-laundering, including corruption and terrorist financing.”
The
Sarawak Report, an NGO based in Kuching and London, alleged in a report made
public Sunday that more than US$90 million was passed circuitously in 2007 by
Sabah lawyer Richard Christopher Barnes from Musa into Barnes’ UBS Hong Kong
account before it was forwarded in turn to a UBS Zurich account in the chief
minister's own name.
The
money transfers allegedly were shepherded by a UBS client manager named Denis
Chua, who originally worked at the Singapore branch for HSBC Hong Kong until
2006. According to the report, Chua moved to UBS, taking the accounts with him.
The
Sarawak Report said Hong Kong’s Independent Commission Against Corruption discovered
the transactions in an investigation into alleged money-laundering by a Musa
associate, Michael Chia Tien Foh, and compiled a detailed list of the
transactions between Barnes, Chia and the UBS accounts.
Denis
Chua is believed to have left UBS. A call to the UBS Hong Kong office elicited
no response. Panday declined any further comment on the matter.
Hong
Kong’s money-laundering law, which appears to be focused mainly on drug
trafficking, nonetheless make it an offense for bankers, lawyers or accountants
to deal with property they know or have reasonable grounds to believe
represents the proceeds of drug trafficking or other serious crimes. Offenders
are subject to a maximum of 14 years in prison. Records must be kept on any
transaction over HK$8,000, the rough equivalent of US$1,000.
The
Hong Kong Monetary Authority’s voluminous guidelines put the onus on banks and
other financial institutions and their professional employees to ensure that
companies follow legal guidelines on deposits. As required by the guidelines,
banks make it a common practice to subject all employees dealing with the
transfer of funds to regular, detailed briefings on money-laundering statutes
and the penalties involved.
The
need to guard against money laundering received new impetus in 2004 when the
Hong Kong Monetary Authority urged banks to be especially alert to the
possibility of money laundering as the territory prepared to become an outlet
for yuan-denominated deposits. In June of that year, the HKMA issued a supplement
to the territory's anti-money laundering guidelines, setting out
"Know-Your-Customer" principles, taking account of the requirements
of a paper on "Customer Due Diligence for Banks" issued by the Basel
Committee on Banking Supervision.
However,
it is believed that despite the voluminous allegations and documents presented
by Sarawak Report into Denis Chua’s activities, no further investigation into
the bank’s activities will be carried out in Hong Kong.
The
files and documents amassed by Sarawak Report, which can be found here, are
regarded by authorities to be genuine although Cecily Chik, senior press
information officer at the ICAC in Hong Kong, simply said "We would not
comment on questions on operational matters." According to Sarawak Report,
the documents were forwarded by the ICAC to the Malaysian Anti-Corruption
Commission, known as the MACC.
The NGO
alleged that Abdul Gani Patail, the Malaysia Attorney General, blocked an
investigation into the case. The Sarawak Report told Asia Sentinel that Gani's
wife is connected both to the key associate of Musa Aman at Yayasan Sabah,
which controls the state's wood supply and the brother of Anifah Aman's wife.
Apparently frustrated MACC officials passed the file to the NGO.
In any
case, the Sarawak Report alleged that the money in the Hong Kong accounts was
ordered frozen when ICAC investigators moved in, but when the three-year
statute of limitations lapsed in Malaysia, the funds are believed to have been
passed on to the Zurich account and to Musa. The Hong Kong Monetary Authority
guidelines, however, established a six-year statute of limitations.
“Those
involved blame Malaysia’s refusal to sign a cooperation agreement on the
investigation for the collapse of the case and the subsequent release of all the
money back to Musa and his collaborators,” Sarawak Report alleged.
A May
25, 2007 letter obtained by the ICAC stated that the UBS account no. 231117
should “hold [the money] on trust for Aman,” the NGO said. Investigators noted
that on May 31 2008 the account contained US$29.6 million. The NGO alleged that
Musa was paid the money for illegal timber sales.
A flow
chart said to have been created by the ICAC in Hong Kong shows money coming in
from certain companies into accounts managed by Michael Chia and his nominees
in Hong Kong, then being passed to a number of British Virgin Island companies
including CTF International, Zenique Investment and Blisstop Corp. then back to
the UBS Hong Kong account managed by Barnes.
The
chart demonstrates that the accumulated money was then passed from Barnes into
UBS Account No. 230-75069201 in Zurich in the name of Musa Aman.
Investigators
noted that on 31st May 2008 the Barnes accounts contained US$29.6 million for
account 231117, US$37 million for account 280777 and SG$9.5 million for account
280666. The Hong Kong Account 231117, which had been in existence since 2006, received
a US$22.4 million injection of money from another Barnes account, between April
28th and May 31st.
According
to the report, much of the money coming into the Chia accounts was linked to
Sabah timber traders connected to listed companies in Kuala Lumpur and Hong
Kong, with Musa directly authorizing the concessions. Some of the transactions
obtained by Sarawak Report name the reason for telegraphic transfers “Deposit
For Concession.”
In
return, loggers are said to have illegally denuded two large areas of forest
supposedly protected by a Heart of Borneo Treaty between the Sabah government
and the World Wildlife Fund -- before Musa signed the Heart of Borneo Treaty
with the WWF.
Asian
Sentinel
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