ZURICH (Reuters) - Private bank Coutts & Co Ltd was ordered to pay 6.5 million Swiss francs ($6.56 million) by Swiss watchdog FINMA on Thursday for breaching money laundering regulations in its relationships with scandal-tainted Malaysian sovereign wealth fund 1MDB.

FILE PHOTO -- A man walks past a 1 Malaysia Development Berhad (1MDB) billboard at the funds flagship Tun Razak Exchange development in Kuala Lumpur, March 1, 2015. REUTERS/Olivia Harris/File Photo

“The bank failed to adequately clarify the circumstances surrounding a number of business relationships and unusually large, high-risk transactions,” FINMA said in a statement.

Assets totaling $2.4 billion were transferred through Coutts & Co accounts in Switzerland, FINMA said, referring to a probe of operations conducted between 2009 and 2015.

FINMA opened its enforcement proceedings in early 2016.

"Coutts & Co Ltd has seriously breached money laundering regulations by failing to carry out adequate background checks into business relationships and transactions associated with Malaysian sovereign wealth fund 1MDB," FINMA said. here

FINMA said it ordered the bank to pay unlawfully generated profits of 6.5 million Swiss francs and would consider opening enforcement proceedings against the employees responsible.

“It did not follow up on relevant internal information and, despite the existence of substantive evidence, failed to report any suspicions to the Swiss authorities until the spring of 2015,” FINMA said.

In December, Singapore’s central bank imposed a penalty of 2.4 million Singapore dollars ($1.70 million) on Coutts due to its money laundering breaches related to 1MDB.

The company is currently in the process of winding down. FINMA said it decided against wider-reaching measures for this reason.

Royal Bank of Scotland (RBS) RBS.L sold the majority of Coutts' international assets to Union Bancaire Privee (UBP) in March 2015 after splitting the bank, founded in the 18th century and best known as banker to Queen Elizabeth, into a British and a Swiss-based arm.

The Swiss watchdog coordinated actions with the Monetary Authority of Singapore and also brought the case to the attention of Britain’s Financial Conduct Authority.

“We regret any historic failings in our AML (anti-money laundering) processes,” RBS said. “Coutts & Co Ltd has progressively and substantially strengthened its AML policies and controls.”

Geneva-based UBP said it does not comment on actions taken by financial regulators against other financial institutions, adding it was not legally affected.

“The acquisition of Coutts International, which had concluded in April 2016, was an asset-only deal and as such, Union Bancaire Privee does not inherit any of Coutts’ legal issues or liabilities,” UBP said.