UBS Board Gauges Fallout of ING Laundering Probe on New CEO
23 Dec 2020

Just weeks into his tenure as UBS Group AG chief executive officer, Ralph Hamers is facing questions over whether his role in ING Groep NV’s money laundering scandal will derail his new job.

UBS Chairman Axel Weber is speaking with supervisory board members about how a probe by Dutch prosecutors will affect Hamers’ ability to lead the bank, people with knowledge of the matter said. Some board members were caught off-guard by the court’s decision to investigate Hamers after due diligence during his hiring suggested the scandal was effectively over, the people said, asking not to be identified as the deliberations are private.

Board members have gone as far as informally discussing who could take on the CEO role if the situation with Hamers became untenable, the people said.

“The chairman and the board of directors have expressed full confidence in our CEO,” UBS said in an emailed statement.

Hamers, seen as a surprise hire in February because of his lack of experience in wealth management, only took over as CEO last month. His early weeks have been marred by the decision to open the probe into his role in ING’s past failures to comply with anti-money laundering rules. The matter comes on top of UBS’s own legal troubles, including the appeal of a record 4.5 billion-euro penalty in France, where it’s accused of helping wealthy clients stash undeclared funds offshore.

ING avoided prosecution in 2018 by agreeing to a 775 million-euro ($940 million) settlement and admitting it had failed to comply with anti money-laundering rules. Koos Timmermans resigned shortly after as Chief Financial Officer, making him the highest profile departure at the bank because of the scandal.

The public prosecutor said in 2018 that it didn’t find enough evidence for criminal accusations against individuals at ING, including the top management.

In the aftermath of the announcement of the Dutch probe earlier this month, both UBS and Swiss regulator Finma said they had conducted due diligence on Hamers at the time of his nomination in February. Finma reconfirmed that it had found him “fit and proper” to run UBS as CEO.

By Eyk Henning, Patrick Winters, Jan-Henrik Foerster and Steven Arons, Bloomberg, 22 December 2020

Read more at Bloomberg

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