Switzerland Returns $8.5 Million in Corruptly Obtained Assets to Peru, Setting Precedent for Global Asset Recovery

Landmark Decision Sets New Standard for Combating Corruption

In a groundbreaking move, Switzerland’s Federal Supreme Court has ordered the return of approximately $8.5 million in corruptly obtained assets to Peru, marking a significant victory in the fight against corruption and setting a precedent for global asset recovery.

The Case: A Web of Corruption

The case involves a complex web of corruption linked to former Peruvian President Alberto Fujimori’s regime. Specifically, it centers around the purchase of overvalued fighter jets from Belarus during his tenure. The funds were held in a Zurich bank account owned by German- Israeli businessman Moshe Rothschild Chassin, an accomplice of Fujimori’s intelligence chief Vladimiro Montesinos.

Peru’s Successful Investigation

The Peruvian authorities, with the assistance of the Basel Institute, successfully proved that the assets derived from corrupt contracts and sought to confiscate them through its Extinción de dominio law, a form of non-conviction based forfeiture. Despite multiple appeals by Chassin, Swiss judges agreed that Peru had met all applicable standards and legal rights in its investigation.

Non-Conviction Based Forfeiture: A Powerful Tool

This case highlights the potential of non-conviction based forfeiture laws in recovering illicit assets, even when criminal convictions are unattainable. The Basel Institute’s Oscar Solórzano noted that this innovative tool enables authorities to target “untouchables” or at least the stolen funds they hold, sending a powerful message to corrupt officials.

International Cooperation Key to Success

Improved international cooperation between Peru and Switzerland was also crucial in achieving the confiscation order and executing it. Judge Hamilton Castro emphasized that such cooperation is essential for countries seeking to recover corrupt assets, as many states harbor illicit assets without cooperating on cases where they lack equivalent asset recovery mechanisms.

Impact and Future Prospects

The returned funds will be transferred to Peru and used to strengthen the country’s law enforcement and judicial systems, in line with a trilateral agreement between Switzerland, Luxembourg, and Peru. This success story serves as an inspiration for other countries, particularly in Latin America, to adopt similar measures and foster international cooperation in the fight against corruption.

Experts at the Basel Institute believe that effective, proportionate, and human rights-respectful asset recovery mechanisms are essential in combating crime globally. The organization’s Programa GFP Subnacional, funded by the Swiss State Secretariat for Economic Affairs, provides technical assistance to Peru and other partner countries in this regard.

Quote from Judge Hamilton Castro

“This case demonstrates that asset recovery is not only a legal imperative but also an opportunity to strengthen institutions and promote transparency,” said Judge Hamilton Castro. “We hope that this success will pave the way for further cooperation between our jurisdictions and contribute to the global fight against corruption.”