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Hong Kong’s banking regulator has fined the local branch of private bank Coutts HK$7m ($901,000) for breaking anti-money laundering regulations, following similar fines in Switzerland and Singapore connected to Malaysia’s 1MDB scandal.

Between April 2012 and June 2015, the private banking unit failed to establish effective methods of determining if its clients were politically exposed people, the Hong Kong Monetary Authority said in a notice.

The UK-based private bank, which is one of the world’s oldest and still counts Queen Elizabeth II among its clients, has been repeatedly linked to a plot to loot billions of dollars from 1MDB, the Malaysian state investment fund.

The HKMA did not directly mention the 1MDB scandal in the notice. However it said that Coutts failed to secure senior management approval to continue doing business with individuals after discovering that they were politically exposed.

“These failures were symptomatic of the deficiencies in procedures,” the notice said.

Jho Low, a Malaysian dealmaker linked to the scandal, opened a Coutts account in Zurich in 2009. Mr Low, who has previously denied any wrongdoing, has been accused by authorities in the US of purchasing luxury properties, art and a $35.4m private jet as part of a conspiracy to launder money stolen from 1MDB.

1MDB-related assets of $2.4bn were transferred through Coutts accounts in Switzerland, according to the Swiss financial regulator Finma. Earlier this year, Finma ordered Coutts to pay back profits of SFr6.5m, which were allegedly generated unlawfully. It is also considering enforcement proceedings against bank employees.

In December, Singapore’s regulator fined Coutts S$2.4m for similar breaches of anti-money-laundering regulations and failing to meet due diligence requirements for politically exposed persons.

Coutts is owned by the Royal Bank of Scotland, but agreed to sell its international assets to Swiss bank UBP in 2015. A UBP spokesperson stressed that the bank “acquired a portion of Coutts International’s client base, but not the legal entity itself”, and said it has no legal liability for Coutts Hong Kong’s former business.

A spokesperson for RBS said:

We welcome the conclusion of the investigation by the Hong Kong Monetary Authority into the Hong Kong branch of our legacy international private bank business and its finding that we have ‘taken positive and intensive remedial measures’ to address the failings identified.

We regret any historic failings in our anti-money laundering processes and are in the process of winding-down this Swiss-incorporated business, following the sale of the majority of the assets last year. As announced in 2014, this sale reflects the revised risk appetite of RBS and its subsidiaries.

Additional reporting by Nicholas Megaw

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