Swiss Banking Regulator Urges Greater Cooperation With Foreign Investigations

by Ulrika Lomas, Tax-News.com, Brussels

08 February 2002

According to reports, despite having recently suffered a setback in his campaign to increase cooperation between the Swiss banking sector and overseas regulators, the head of the Swiss Federal Banking Commission, Daniel Zuberbuehler, is far from beaten.

Although Swiss banking secrecy laws permit cooperation with foreign regulators for the purposes of criminal investigations, Article 38 of the Swiss Federal Bourse and Securities Law, introduced in 1997, forbids the Banking Commission from passing on information in 'administrative' cases, such as tax evasion and insider trading. This, says Mr Zuberbuehler, prevented the Swiss banking regulator from providing assistance to the US Securities and Exchange Commission (SEC) in a recent insider trading case.

Following the Supreme Court ruling which forbade the Federal Banking Commission from assisting in the investigation of the Elsag-Bailey case, the Swiss banking regulator told the SEC to utilise the provisions of an old treaty which would allow it to request information via the criminal justice authorities instead, and announced his intention to petition the Swiss government for a change to banking secrecy laws.

'If you cannot comply with certain minimum standards internationally, then you risk being considered as a sort of black box, and you could even be misconstrued as having banking secrecy there to favour insiders,' he told the Reuters news service.

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