Swiss prosecutors have fined Morgan Stanley’s Swiss arm $1 million for failing to prevent money laundering linked to bribery in Greece. The case involves illicit funds tied to former Greek Defense Minister Akis Tsohatzopoulos, funneled through a Swiss-based client advisor. The former Greek minister was convicted in 2013 over bribery and money laundering charges and received a 20-year prison sentence.
Key Points
- Swiss Fine: $1 million penalty for money laundering failures.
- Client Advisor’s Role: Facilitated laundering of bribery proceeds.
- Greek Connection: Linked to ex-Defense Minister Akis Tsohatzopoulos.
- Straw Men Accounts: Funds passed through a cousin’s Swiss bank account.
- Morgan Stanley’s Cooperation: Waived opposition to penalty order.
Short Narrative
Morgan Stanley’s Swiss operations have been hit with a $1 million fine over a 2010 money laundering case tied to bribery in Greece. The Swiss Attorney General’s Office ruled that Bank Morgan Stanley (Switzerland) AG failed to prevent a client advisor from laundering assets linked to former Greek Defense Minister Akis Tsohatzopoulos. The funds, disguised through accounts of a relative and a straw man, triggered an investigation. Morgan Stanley has accepted the fine without contesting it.
Prosecutors accused the former defense minister, Akis Tsochatzopoulos, a founding member of the Socialist Party and the highest-ranking Greek official ever to be detained on corruption charges, of pocketing at least $26 million in kickbacks for Greece’s purchase of submarines and missile systems and funneling the money through offshore accounts to buy property. In 2013, he was found guilty and was sentenced to 20 years, but was released in 2018 on health grounds and died in 2021.
Actionable Insight
This case underscores the persistent regulatory risks facing global banks over historical compliance failures. Enhanced due diligence and transaction monitoring remain critical in preventing such violations.
Call for Information
Have insights on compliance failures at major financial institutions? Reach out to FinTelegram—confidentiality guaranteed.
