ZURICH: Transparency International, the global watchdog against corporate and political corruption, has asked Switzerland to extend scope of its anti-money laundering legislation to help prevent corrupt from hiding on its soil.
A press release posted by the Switzerland Chapter of the TI said that Switzerland must make it much harder for the corrupt to hide behind secret companies if the country wants to keep criminal activity out of its financial system. The communiqué was released as TI Switzerland launched the “Unmask the Corrupt” campaign in Switzerland on September 2.
No longer should the corrupt be able to get away with illicit activities, often linked to international organised crime, with the help of Switzerland, Eric Martin, Chair of TI Switzerland said.
Currently, the TI statement said, Switzerland does not require the identity of the real, living people who ultimately own, control or benefit from a company. This secrecy makes it easier for corrupt foreign public officials and businesspeople to hide the origin of their stolen money from the law enforcement, the public and governments who may seek its return. Switzerland must collect this information, and make it accessible to law enforcement. Public registers are the best way to do this not least since banks would be required to consult this register when undertaking due diligence on their clients.
TI Switzerland’s efforts to unmask the corrupt and throw light on company ownership is part of a broader Transparency International campaign that calls on governments worldwide to halt illicit financial flows stolen through the abuse of power, bribery and secret deals.
“For too long, the corrupt have been allowed to hide their ill-gotten gains in foreign countries. This has to stop now in the interest of all countries and their citizens,” warned Cobus de Swardt, Transparency International’s Managing Director.
In Switzerland, the campaign coincides with the parliamentary debate over a bill regarding the implementation of recommendations made by the Financial Action Task Force (FATF).
The recommendations are currently recognised as the international standard for combating money laundering. The Swiss Parliament should not attempt to dilute the current Federal Bill and should also work towards measures to ensure the effectiveness of essential legislation such as a better protection for whistleblowers and a reinforcement of the Swiss penal code for cases of private corruption.
To stop the corrupt from enjoying their ill-gotten gains, Switzerland must also restrict the size of cash payments when buying luxury goods. The ability to spend large amounts of cash without a regulated financial intermediary greatly increases the risk of money laundering.
To make significant progress in unmasking the corrupt, Transparency International Switzerland calls for urgent steps to be taken in the following areas:
It is well known that cash payments are frequently used for money laundering and play an important role in cross-border crime. Therefore, Transparency International Switzerland is calling for a legal limitation of the sums that can be paid in cash. Payments for real estate or luxury goods exceeding 100,000 francs should be settled through a financial intermediary subject to the Swiss Anti-Money Laundering Provisions.
“Switzerland needs to take responsibility and toughen its anti-money laundering legislation. The world’s financial architecture needs to be made more transparent and offshore financial centres should not allow corporate vehicles to be misused by criminals to hide their identity and stolen wealth behind secret corporate structures while enjoying a life of luxury with impunity paid from taxpayers’ money,” said Martin.
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