Swiss financial watchdog FINMA has fined Julius Baer, Switzerland’s second-largest listed bank, more than 4 million Swiss francs (around $5 million) for major shortcomings in its anti-money laundering (AML) controls. The penalty, announced in May 2025 but relating to issues from 2009 to 2019, reflects the regulator’s findings that the bank failed to identify and act on suspicious transactions involving high-risk clients.
FINMA’s investigation revealed that Julius Baer overlooked warning signs and continued managing accounts connected to individuals under legal scrutiny, including a Russian banker accused of embezzlement and several Indian clients across its Dubai, Zurich, and Singapore branches. Despite clear red flags, the bank did not properly assess or address the risks posed by these accounts. As a result, FINMA ordered the bank to forfeit 3 million Swiss francs in illicit profits and pay an additional 1.3 million Swiss francs in related costs.
This enforcement is part of an ongoing pattern of regulatory challenges for Julius Baer. In 2020, FINMA had already flagged the bank’s weak AML measures linked to alleged corruption involving Venezuela’s state oil company and FIFA, leading to restrictions on acquisitions until improvements were made. Moreover, in 2022, the UK’s Financial Conduct Authority fined Julius Baer £18 million ($24 million) for failing to conduct its business with integrity, a fine the bank accepted without dispute.
In response to these pressures, Julius Baer has implemented significant leadership changes. Stefan Bollinger, previously with Goldman Sachs, was appointed CEO in early 2025 and has launched a major cost-cutting and restructuring program. Additionally, former HSBC CEO Noel Quinn took over as chairman. The bank has also overhauled its governance and risk management frameworks, including exiting its private debt business tied to the collapsed Austrian property firm Signa.
FINMA’s decisive action sends a strong message to financial institutions about the critical importance of maintaining robust AML systems. With financial crime risks becoming increasingly sophisticated, regulators worldwide expect banks to conduct thorough due diligence, monitor high-risk activities vigilantly, and respond swiftly to suspicious behavior.
Julius Baer’s case serves as a stark reminder of the consequences that can arise from compliance failures and highlights the ongoing need for continuous enhancements in AML oversight and risk management practices. Regulators and market participants will be closely watching how the bank’s reforms unfold in the coming months.
