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Switzerland tightens noose on financial crooks

Balleyguier, head of the Swiss office combating money laundering, believes suspect funds are being diverted away from Switzerland Keystone

Switzerland's beefed-up anti-money laundering controls are proving so effective that those with something to hide are choosing to bank elsewhere.

Dina Balleyguier, the head of the Swiss Money Laundering Control Authority, said that as a result of Switzerland’s clampdown, suspicious funds may now be flowing elsewhere, notably to London.

Something to hide

“In all, I think that Switzerland is fighting dirty money efficiently,” Balleyguier told a news briefing in Geneva.

“The proof is that several financial intermediaries (asset managers and bankers) say that with all of the reporting obligations which Switzerland imposes on them, all the questions they are obliged to ask their client, many of the clients have opted to go elsewhere – to London,” she said.

This proved that a client with “something to hide” had no chance of escaping regulators in Switzerland, she added.

Criminal investigations

Switzerland, which houses a third of the world’s $27 trillion offshore wealth, has often been accused of being a haven for money with suspect origins.

However, banking secrecy can be lifted to facilitate criminal investigations into suspect accounts held by the likes of the former Nigerian dictator, Sani Abacha.

The Swiss non-banking or para-banking sector was now “x-raying” clients about the origin of their funds, Balleygueir said. Swiss banks and intermediaries are now required to “know their customer”.

“Good nose”

Balleyguier conceded that the fight against money laundering could not be 100 per cent successful, but suggested that the best tool for detecting dirty money was a “good nose”.

The Money Laundering Control Authority was set up in 1998 to clamp down on money launderers in the para-banking sector under the Money Laundering Act passed the same year.

After a shaky start, Balleygiuer said she now had the resources at her disposal to do her job. “But we still need three more auditors,” she said.

Brazilian mayor under investigation

Meanwhile, Genevan judicial authorities are currently investigating suspect accounts said to have belonged to the former mayor of Sao Paulo, Paulo Maluf.

Brazilian media have accused Maluf of embezzling some $200 million in public funds. The money reportedly transited through a bank in Geneva before being deposited in a bank in Jersey.

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SWI - a branch of Swiss Broadcasting Corporation SRG SSR

SWI - a branch of Swiss Broadcasting Corporation SRG SSR