Emma RadmoreFCA has fined Julius Baer International £18,022,500 for breaches of Principles 1, 3 and 11 at various times between 2007 and 2014. It has also decided to ban 3 individuals – all of whom have taken their case to the Tribunal.
The failings stemmed from an arrangement made by the firm’s Russian and Eastern European Desk with Dimitri Merinson, an employee of the Yukos Group of companies. Under the arrangement, Mr Merinson would ensure Yukos Group companies gave JBI significant business, and would be paid a finder’s fee for his efforts. JBI made uncommercial FX transactions for the companies and charged them far higher than standard rates, and shared the profits with Mr Merinson, by paying him far higher commission than would be normal for a finder’s fee.
FCA found JBI had had no policies around the use of finders until 2010, and after that the policies it introduced were inadequate.
FCA said that, eventually, JBI became aware of potential bribery and corruption and fraud, but failed to report the suspicions until 2 years later.
FCA said that the firm, and the three individuals (the Desk Relationship Manager and two supervisors and board members), were aware of obvious signs that the relationships were corrupt, but ignored them.
The firm agreed at an early stage to settle all issues of fact and partially agreed liability but not penalty and as a result qualified for a discount of 15-30%