Merrill Lynch’s Taiwanese Laundry

...Former president Chen Shuibian’s daughter-in-law Huang Jui-Ching reportedly opened two Merrill Lynch (MER) bank accounts in Switzerland (at Merrill Lynch Bank Suisse AG) in February 2007, and remitted millions of dollars from an anonymous Credit Suisse Singapore account in February and March that year into two separate accounts at Merrill Lynch in Switzerland. First there were transfers of $21 million and $140,000 respectively.

A Cayman Islands account was set up three months later, and Huang transferred all the funds held in her personal name to this company. Merrill Lynch set up the Cayman Islands company on behalf of Huang, which is owned by Huang with power of attorney granted to Chen’s son, Chen Chihchung. It has also been reported that an additional $10 million was wired from RBS Coutts to the Cayman company account at Merrill Lynch in Switzerland.

 Yadda yadda yadda.

Sources close to Merrill say that the bank tipped off the Swiss authorities after the bank got suspicious...

So why the tip off now? We can only speculate, but perhaps they may have decided to come clean after seeing what was happening to UBS (UBS) in the US, where the Swiss bank is embroiled in a massive tax evasion case...

You think? A NakedShorts correspondent avers that “this article is on the right track, but reporters need a better sense of smell, since this is just one body in a very large graveyard.” Also worth noting is the speed with which Singapore, the world’s largest family office, has come to be ranked high among the usual suspects in these tawdry tales.

How did Merrill Lynch miss the red flags?
by Dan Slater
FinanceAsia Aug. 21 2008 

Hardly related at all:

Temasek May Lift Stake in Merrill
by Jean Chua and Chen Shiyin
Bloomberg  Aug. 21 2008

Comments

[Alan Young:]

I can't tell what your point is. Are you saying to disregard the suspicion cast on MER, because the reporter didn't get the story right? Or are you saying that this is just the tip of an iceberg of corruption that could put the brokerage into a large cauldron of hot water?

2008 Aug 22 03:39 AM

[HKI:]

What's your point? That Singapore is corrupt as well? Night and day differences there. Don't see what the connection is between Singapore and Taiwan. And Singapore would be one of the least corrupt.

2008 Aug 22 09:34 AM

[peterrabbit:]

Huh? I read the full article - you miss out all the interesting bits about how ML has a system in place which was completely overridden in the case of the Taiwan money laundering. I don't get what you are saying either.

2008 Aug 22 11:38 PM

[Old Trader:]

Guessing the $140k was the "lunch money" account...

2008 Aug 23 03:29 AM

[Concern by ...:]

I do not believe Taiwan Government is aware of additional 10 million dollar (US) was wired from RBS to Chen's account in Cayman. Swiss government should pass this information to Taiwan authority.

2008 Aug 24 10:35 PM