NEW YORK CITY, New York: UBS has agreed to pay a record US$125 million civil penalty after U.S. regulators found the Swiss bank repeatedly violated anti-money laundering laws, marking the largest fine ever imposed on a broker-dealer under the Bank Secrecy Act.

The U.S. Treasury Department's Financial Crimes Enforcement Network (FinCEN) said on Monday that UBS Financial Services admitted it willfully violated the Bank Secrecy Act by failing to implement and maintain an effective anti-money laundering program and by failing to file suspicious activity reports.

The settlement reflects UBS' status as a repeat offender. The bank was fined $14.5 million by FinCEN in 2018 over similar deficiencies, but regulators said the latest violations occurred between January 2019 and June 2023.

The agreement also resolves related allegations brought by the Securities and Exchange Commission, the Commodity Futures Trading Commission and the Financial Industry Regulatory Authority.

In a statement, UBS said it cooperated with regulators and had made significant investments to strengthen its anti-money laundering program "in line with leading industry practices."

Regulators said UBS failed to conduct adequate due diligence on customers, particularly high-risk clients with ties to Russia and Latin America.

According to FinCEN, one customer was a Russian oligarch with close ties to Russian President Vladimir Putin who allegedly maintained UBS accounts despite media reports questioning how he accumulated his wealth and linking him to possible money laundering, and who was associated with a company "actively invested" in Iranian digital assets.

UBS was also accused of failing to properly monitor more than 60,000 foreign-currency wire transfers totaling over $10 billion. Regulators said similar shortcomings had already been identified in the bank's 2018 enforcement action.

As part of the settlement, UBS Financial Services must hire an independent consultant to review its anti-money laundering program, with particular focus on priority illicit-finance risks involving the U.S. Southwest border, cartels, narcotics trafficking, and activities linked to Iran, Russia, and Venezuela.

"Today's historic action against UBSFS should send a clear message that recidivist financial institutions will face severe repercussions," FinCEN Director Andrea Gacki said in a statement.