Financial Crime World

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Switzerland’s Fight Against Money Laundering and Terrorist Financing

A recent report by the Swiss Federal Council reveals that corruption abroad, membership in criminal organizations, and street crime pose a high risk of money laundering to Switzerland. Additionally, terrorist financing is a significant concern, particularly for non-profit organizations (NPOs) operating in conflict zones.

Implementing Effective Measures

The report highlights the importance of implementing effective measures to prevent and combat terrorist financing through NPOs. To achieve this, the Swiss government recommends:

  • Extending the obligation to enter associations in the commercial register to include those with a heightened terrorist financing risk
  • Maintaining a member list for registered associations

Awareness-Raising Initiatives

Moreover, the report emphasizes the need for awareness-raising initiatives within the NPO sector, among financial intermediaries, and the general public. This includes:

  • Publishing factsheets on combating money laundering and terrorist financing
  • Implementing provisions consistently across all sectors

A separate report published by the Swiss Federal Council examines the risk of money laundering posed to Switzerland’s financial centre by commercial legal entities.

Key Findings

The study found that foreign companies pose a significantly higher risk of money laundering than Swiss companies, due to their involvement in international business and financial cycles.

Recommendations

To prevent and combat money laundering through commercial legal entities, the Swiss government recommends:

  • Extending due diligence and reporting obligations under the Anti-Money Laundering Act to all service providers involved in the establishment and management of foreign companies

Risk of Money Laundering and Terrorist Financing posed by Crypto Assets and Crowdfunding

A recent report published by the Swiss Federal Council investigates two main uses of fintech: crypto assets and crowdfunding.

Key Findings

The report highlights the risks related to crypto assets, including their potential use for money laundering and terrorist financing.

Recommendations

To prevent and combat money laundering and terrorist financing through crypto assets and crowdfunding platforms, the Swiss government recommends:

  • Implementing stricter regulations on these platforms, including enhanced due diligence and reporting obligations under the Anti-Money Laundering Act

Conclusion

Overall, the reports highlight the importance of Switzerland’s efforts to prevent and combat money laundering and terrorist financing. The Swiss government is committed to implementing effective measures to protect the country’s financial centre from these threats.