Swiss Banker on Trial With Alleged $2.2 Million Insider Trader

This content was published on June 4, 2021 - 08:26

(Bloomberg) -- A Swiss businessman faces a trial Monday accused of leaking company secrets to a former Lazard banker and then trading off the information in a case that has embroiled two companies that are mainstays of Swiss industry.

Hans Ziegler is accused of exploiting his role as a director of pump-making conglomerate Oerlikon Corp. and steel producer Schmolz & Bickenbach to feed commercially-sensitive information to the banker for over three years until he was found out in late 2016. Ziegler passed 19 valuable chunks of data on to the banker, who can only be named as B. under Swiss reporting restrictions.

Lawyers for Ziegler and B. did not return messages seeking comment.

Federal prosecutors opened a probe into Ziegler, himself the former CEO of Swiss conglomerate Erb Group, in 2016 after learning of the allegations. He resigned from the boards of Oerlikon and Schmolz & Bickenbach as the probe became known.

Ziegler, 68, exploited his role as a director of Oerlikon, Schmolz and two other listed Swiss companies, to make nearly 2 million Swiss francs ($2.2 million) in repeated trades on shares of 11 different companies, according to the indictment. Ziegler, who was for a period a paid adviser to Lazard, allegedly disclosed secrets about a Swiss company being acquired by foreigners to B., and then demanded 150,000 Swiss francs for the information, prosecutors said.

Ziegler allegedly traded illegally in a range of stocks that spanned the Swiss economy from retailer Charles Voegele Holding AG to Micronas Semiconductor Holding AG to travel agency Kuoni Reisen Holding AG. There is no suggestion of wrongdoing on the part of those companies.

B. stands accused of breaking secrecy laws and commercial espionage, similar but distinct charges under Swiss law, as well as paying bribes.

Insider trading as a crime can carry a punishment of as much as three years in prison in Switzerland. However, it only became a crime in Switzerland in 1998 and prison terms are rare, with suspended sentences or fines being the norm. The spying charges could also carry a sentence of three years in prison.

A spokesman for Lazard in Switzerland said B. was dismissed toward the end of 2017, and declined to comment further.

A spokesperson for Oerlikon declined to comment while a call to Schmolz & Bickenbach wasn’t returned.

Four days have been set aside for the trial with a verdict scheduled for June 22.

©2021 Bloomberg L.P.

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