Switzerland Strengthens Process To Deal With Illicitly Acquired Assets

by Ulrika Lomas, Tax-News.com, Brussels

02 June 2016

Switzerland's Foreign Illicit Assets Act will enter into force on July 1, providing a new regulatory framework for the freezing, confiscation, and the restitution of illicitly acquired assets.

The Act will be employed in cases that cannot be solved on the basis of the Act on Mutual Assistance in Criminal Matters. According to the Swiss Federal Council, it "aims to address situations where foreign leaders have enriched themselves by misappropriating assets through corrupt or criminal means and have then transferred those assets to financial centers in other countries."

The Act also enables Switzerland to provide legal support or send experts to assist the recovery of the illicitly acquired assets in the states where they originated. The Federal Council said that the approach chosen by the Swiss authorities to expedite the mutual legal assistance process is to order the preventive freezing of assets. In the event that mutual legal assistance proceedings do not succeed, this approach will allow the Federal Council to confiscate and return the assets under the new Foreign Illicit Assets Act.

The Act will modify the Ordinance on the Money Laundering Reporting Office Switzerland, with effect from July 1. The Office will then serve as a "one-stop shop" responsible for receiving information about the assets of those affected by an asset freeze.

Three separate ordinances will implement the preventive freezing of the assets of former presidents Zine El Abidine Ben Ali of Tunisia, Hosni Mubarak of Egypt, and Viktor Yanukovych of Ukraine until early 2017. The Federal Council will examine whether it is appropriate to extend the period for which the assets are frozen within the limits provided by the Foreign Illicit Assets Act.

TAGS: money-laundering | law | banking | financial services | enforcement | legislation | Egypt | Switzerland | Tunisia | penalties | Ukraine | services