Frankfurt: German market regulator BaFin is investigating whether UBS' German operations adhered to money-laundering rules, BaFin said, adding to the Swiss bank's woes as investigators hunt for untaxed wealth.
The German watchdog began the probe — related to a separate investigation by Frankfurt prosecutors into allegations by a former UBS client — in mid-March.
"We confirm that BaFin has initiated a special probe in connection with the issues raised by Peter S. UBS Germany is of course cooperating with BaFin," UBS Germany said in a statement, referring to the former client.
Frankfurt prosecutors are looking into suspected fraud, breach of fiduciary trust and tax evasion at the German arm of Switzerland's biggest bank.
Responsibility
German market regulators have responsibility for monitoring banks' adherence to market rules such as money laundering regulations, while German prosecutors have responsibility for pursuing individual cases such as tax evasion.
The probes come hot on the heels of a widespread international crackdown on tax evasion against Swiss banks spearheaded by Germany and the United States.
The Swiss government is preparing to hand over the names of UBS clients suspected of hiding funds from US tax authorities.
German authorities have launched 1,100 tax evasion probes against Credit Suisse clients and are investigating whether the number two Swiss bank's staff abetted tax evasion.
