On March 27, Luxembourg’s financial regulator, the Comite de Surveillance du Secteur Financier (CSSF), announced (in French) that it had suspended Marc Ambroisien, the former chief executive officer of Luxembourg private bank Edmond de Rothschild (Europe), for ten years, based on a “loss of professional repute.” (Note: All translations to English herein are unofficial.)
The CSSF noted “serious shortcomings,” both individually and personally, with regard to Ambroisien’s service as a former certified director and former member of the board of directors of Rothschild. It specifically cited him for having failed in his obligations to see that Rothschild (1) “put in place a solid internal governance system and sound and prudent risk management”; and (2) “respects its professional obligations with regard to the fight against money laundering and terrorist financing.”
As a result, the CSSF concluded that Ambroisien no longer met the requirement, under section 7(1) of Luxembourg’s Law of April 5, 1993 on the Financial Sector, that authorization for a bank established under Luxembourg law be subject to the condition that members of a management body “shall at all times be of sufficiently good repute . . . to perform their duties.”
Note: This extraordinarily severe sanction by the CSSF can be directly traced to Rothschild’s entanglement in the Malaysian 1 MDB corruption and money-laundering scandal. In 2017, the CSSF fined Rothschild €8,985,000 in connection with the bank’s alleged involvement in the scandal. While the CSSF did not accuse Rothschild of money laundering related to 1 MDB, it cited the bank – in language highly similar to its recent suspension of Ambroisien – for “having failed in its obligation to put in place a solid internal governance system that covered, in particular, a compliance policy and respect for banks’ professional obligations with regard to the fight against money laundering and terrorist financing.”
At that time, media reports had accused Ambroisien, who had left his directorship at Rothschild in 2015, of having “knowingly received gray money” amounting to hundreds of millions of dollars from transactions related to 1MDB. Ambroisien has not been charged in any 1MDB-related criminal cases, but the CSSF suspension effectively terminates his banking career in Luxembourg.