Ex-Julius Baer CEO Collardi Reprimanded in Laundering Probe

(Bloomberg) -- Ex-Julius Baer Group Ltd. Chief Executive Officer Boris Collardi was reprimanded by Switzerland’s financial regulator over a money laundering probe that has cast a shadow over his move to Geneva private bank Pictet & Cie.

While Collardi said he won’t face any further penalties in the case -- related to alleged corruption in Venezuela -- the Swiss watchdog is starting enforcement proceeding against one unidentified Baer manager, it said in a statement on Thursday. The actions come almost a year after the regulator said the bank fell significantly short in combating money laundering in its Latin American business between 2009 and early 2018.

Collardi said in a statement that he accepts the regulator’s reprimand and faces no further actions. “This decision now brings this matter to a close for me,” he said. Bernhard Hodler, his immediate successor at Julius Baer, “takes note” of a reprimand against him and has no further comment, a spokesman said.

Collardi led a period of breakneck expansion during his tenure as Baer CEO through nearly a dozen acquisitions and joint ventures. That later sparked investigations into how well the bank vetted its clients and monitored their business activities.

Zurich prosecutors in June said they were following up a tip about alleged wrongdoing by Collardi and other former Baer managers to determine whether there are grounds to open a criminal proceeding. A preliminary probe is ongoing and no formal action has been started, a spokesman for the prosecutors office said by email on Thursday. The next step will be to review the Finma report published today, he said.

Collardi joined Pictet in 2018 where he is co-head of the wealth management business. A Pictet spokesperson said on Thursday that the bank takes note of the FINMA decision and that the bank stands behind Collardi and has “full confidence” in his work at the company.

Pictet’s partners have discussed potential damage to the firm’s brand related to Collardi’s time at Baer, people with knowledge of the matter told Bloomberg in March, shortly after Finma began its investigation.

Star Banker Collardi’s Past Raises Tensions at Bank Pictet

Finma has been investigating high-ranking individuals at Baer, including Collardi and Hodler. The regulator said on Thursday that it ended a second enforcement proceeding against one person after they agreed not to accept a managerial position at another supervised financial institution in the future.

All the individuals associated with the regulator’s actions are no longer with Julius Baer, according to a spokesman for the bank.

Philipp Rickenbacher, who took over as CEO of Julius Baer in 2019, has reorganized divisions and management and cut jobs as he seeks to focus on improving profitability at the expense of all-out asset growth. Hodler had also sought to rein in the expansion that took place under Collardi.

The regulator’s primary tools for sanctions against individuals include a ban from the financial services industry for as long as five years, however the regulator can forgo the ban if individuals decide to leave the sector for good.

Finma said it gave two people reprimands in writing, without identifying them. The regulator will also open proceedings against five unnamed Swiss lenders after reviewing 30 banks in connection with corruption at Venezuelan state-owned oil company PDVSA.

(Adds separate investigation by Zurich prosecutors in fifth paragraph)