On February 26, 2026, the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (“FinCEN”) published a notice of proposed rulemaking (“NPRM”) in order to sever MBaer Merchant Bank AG from the U.S. financial system for enabling money laundering and illicit finance activities by criminal actors with ties Russia and Iran. According to FinCEN, since its inception, Zurich-based MBaer enabled money laundering and terrorist financing for foreign terrorist organizations, including the Islamic Revolutionary Guard Corps and the Quds Force. If the proposed rule is finalized, U.S. financial institutions would be prohibited from opening or maintaining a correspondent account for, or on behalf of, MBaer.
On February 27, 2026, in response to FinCEN’s threat of sanctions, MBaer decided to withdraw its appeal of an order to revoke its banking license imposed by the Swiss Financial Markets Supervisory Authority’s (“FINMA”), according to FINMA. The withdrawal essentially reinstated FINMA’s original liquidation order. MBaer also issued a press release confirming that the bank was in liquidation and that it was represented solely by the appointed liquidator.
FINMA reported that it launched enforcement proceedings into MBaer in 2024 and subsequently determined that a disproportionate amount its business was high risk. According to FINMA, 80 percent of the bank’s business relationships carried increased risks, and 98 percent of all assets received by the bank were from high-risk clients. FINMA ultimately determined that the bank had “serious, systematic shortcomings” in its anti-money laundering program and was unable to monitor its laundering risks. FINMA also concluded that the bank failed to meet the licensing requirements related to the guarantee of irreproachable business conduct and found that its organizational requirements were no longer being met. During its investigation, FINMA specifically found that MBaer would repeatedly ignore compliance department recommendations on how the bank should deal with high-risk business relationships, often without providing a reason. According to FINMA, the bank would also systematically fail to conduct adequate investigations into the background of business relationships and transactions and occasionally failed to meet its AMLA reporting obligations. FINMA also reported that the bank processed transactions for sanctioned clients and would allegedly help them circumvent official asset freezes.
FINMA indicated that it also opened proceedings in four cases against individuals allegedly responsible for MBaer’s identified breaches.
U.S. Department of Treasury Press Release | FINMA Press Release | MBaer Press Release