Swiss FINMA: MBAER merchant bank in liquidation

Swiss FINMA: MBAER merchant bank in liquidation

Swiss FINMA Appoints Monitor as MBaer Merchant Bank Faces U.S. Financial Restrictions

Swiss private bank MBaer Merchant Bank AG is under scrutiny from both U.S. and Swiss regulators, with the U.S. Treasury Department proposing to sever its access to the U.S. financial system over allegations of facilitating illicit finance tied to Iran and Russia. The Financial Crimes Enforcement Network (FinCEN) announced a proposed rule that, if finalized, would prohibit U.S. banks from maintaining correspondent accounts for MBaer, effectively cutting off its ability to process transactions in the U.S. dollar according to Bloomberg. The Treasury cited evidence that MBaer has "funneled over a hundred million dollars through the U.S. financial system on behalf of illicit actors," including entities linked to the Iranian Revolutionary Guard Corps and Russian money laundering networks as Reuters reported.

In response, the Swiss Financial Market Supervisory Authority (FINMA) has appointed an investigating officer to act as a "monitor" at the Zurich-based bank, following enforcement proceedings initiated three weeks ago. FINMA stated it is cooperating with U.S. authorities but emphasized that its own measures are pending resolution in the Federal Administrative Court according to Swissinfo. The regulator described MBaer as a "primary risk for money laundering," aligning with FinCEN's designation under the USA PATRIOT Act's Section 311 provisions as Treasury documents state.

Founded in 2018 by Michael Baer, a descendant of the Julius Baer family, MBaer specializes in wealth management and corporate services. The proposed U.S. restrictions, currently open for public comment, could significantly disrupt its operations, given the bank's reliance on U.S. dollar transactions. While MBaer has not publicly commented, the U.S. Treasury warned that the move underscores its commitment to safeguarding financial system integrity according to Bloomberg.

The case highlights intensifying international efforts to combat cross-border money laundering, particularly involving state-linked actors. FINMA's monitoring role and the pending legal challenges will determine the next steps for MBaer, which now faces dual regulatory pressures from Switzerland and the U.S. as Swissinfo reports.

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