Finance

the opacity of Swiss finance put to the test – Liberation

After new revelations about dubious funds hosted by one of the country’s largest banks, Credit Suisse, the financial center is once again at the heart of a scandal.

The reputation of the Swiss financial center takes another hit. Published as “Swiss Secrets”, a new international journalistic investigation highlights questionable practices by Credit Suisse, the country’s second largest bank. These data revive the debates around the transparency of the Swiss financial center, which nevertheless tries to take care of its image.

The Organized Crime and Corruption Reporting Project, a consortium of 47 international media, including the world, The Guardian where the New York Timesclaim that the banking establishment has harbored funds derived from crime, corruption or the embezzlement of public money for several decades. The collaborative investigation is based on the leak of information from more than 18,000 bank accounts administered by Credit Suisse from the 1940s until the end of the 2010s.

For its part, the banking establishment firmly rejected these accusations, considering that they were based on data “partial”, “inaccurate” Where “taken out of context”. Credit Suisse also did not fail to point out that some of this information dated back some sixty years and that 90% of the accounts concerned were now closed. Allegations that appear as “a concerted effort to discredit not only the bank but the Swiss financial center as a whole”the establishment reacted again.

Shaken by scandals

Since March 2021, Crédit Suisse has been shaken in turn by repeated scandals: the bankruptcy of the financial company Greensill, the implosion of the American fund Archegos, the fines for loans in Mozambique and the abrupt resignation of its president, eight and a half months after taking charge, for breaking quarantine rules.

What lead the shareholder organization Actares, which campaigns for a sustainable economy, to target asking for this banking establishment. “Credit Suisse must finally create transparency in a seemingly unmanageable sum of discrepancies that not only affects investors, but also the reputation of Swiss banks”she blasted.

Without denying the role banking secrecy has played in Switzerland’s success in the past, the Zurich daily The New Zurich Times has himself noticed in his columns that a “part of the cases revealed by Suisse Secrets would no longer be possible” under current legislation. Indeed, the country has significantly revised its legislation since its showdown with the United States on tax evasion, but also with the twists and turns concerning stolen data handed over to the German tax authorities.

As a sign of good faith, in 2014 Switzerland ratified a cooperation agreement with the United States obliging financial institutions to transmit certain data to the American tax authorities. In 2015, the country signed an agreement with Brussels on the automatic exchange of information. “The anti-money laundering system has been continuously developed and strengthened in recent years”insists the Swiss Bankers Association. “Dodgy money does not interest the Swiss financial centre, for which reputation and integrity are key factors”she added again.

A “Panama Papers” effect

According to a report published at the end of October by the Swiss Ministry of Finance, reports to the Money Laundering Reporting Office were four times higher on annual average between 2015 and 2019 than over the previous ten years.

The authors of this report explained “this rain of reports” by the fact that the banks, more sensitive to the risks that could affect them, had more control over their customers since major corruption cases such as the “Lava Jato” operation in Brazil. But also since press revelations like the Panama Papers or Paradise Papers.

At the same time, the Swiss legislative provisions with regard to the press have also been tightened over the years, preventing investigations into banking establishments. The major press titles of the country also regret today not having been able to participate in the revelations of the Swiss Secrets scandal.

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