Switzerland should review its strategy for recovering illicit funds

The federation should review its strategy for recovering illegal assets blocked in Switzerland. The current legal bases are very vague. The Federal Finance Control notes that the procedures are inconsistent and often very long.

Over the past twenty years, Bern has reimbursed nearly two billion francs from foreign public funds in the context of ten cases. The Financial Control Federal Reserve (CDF) said in an audit released Wednesday that nearly $1 billion could be withdrawn in the coming years.

After the Arab Spring assets and the assets of former dictators Zine El Abidine Ben Ali (Tunisia) and Hosni Mubarak (Egypt), other cases such as the 1MDB scandal in Malaysia or the Petrobras and Karimova case in Brazil continued to pay off the Chronicle. Uzbekistan.

Lack of criteria

The problem is that the federal law on the prevention and restoration of patriarchal values ​​of illegal origin, which entered into force in 2016, concerns the exceptional events of a sudden regime change. According to the CDF, the “law of circumstance”, designed in the context of the Arab Spring, has been rarely used.

International mutual legal assistance and criminal procedure in Switzerland are the main means of investigation. But the CDF specifies that these fall under other legal frameworks and, above all, do not provide for the transfer of funds. So there are no clear criteria to explain why reviews follow one path without following another.

Disappointing expectations

The absence of clear criteria for withdrawing money, with or without conditions, blurs the federation and its synchronicity in Switzerland and criticizes financial regulation. Suddenly, despite the recognized activity in the region, Switzerland struggles to find the support of developing and developing countries.

Cases involving politically explicit persons (PEPs) or former leaders create strong expectations in the countries concerned, recalls the CDF. However, there is a significant gap between the duration of legal proceedings and political concerns. It takes 10 to 15 years to decide whether to seize or release the funds.

“The federation has often promised too many decisions too quickly. This creates frustration and real inconsistency with intentions,” the audit said. However, Switzerland has a policy of reimbursing assets “as soon as possible”.

No preview

Another problem is that there is no perspective on what happens to the energy lawsuits or the amounts withheld, and financial scrutiny continues. Restructuring procedures are only followed by the Federal Foreign Office (FDFA) in limited cases.

Information on unconditional restructuring cases involving PEPs is “very sticky and incomplete”. They are dispersed between the Federal Office of Justice (OFJ) and the prosecutors. The CDF believes that an annual monitoring of funds withheld, the outcome of prosecutions and the target of confiscated funds should be put in place.

New strategy coming soon

The tax regulations recommend that the Federal Council now set clear criteria for determining in which cases withdrawals are subject to conditions. Who decides which way to go.

The government, in response, announces a plan for a new strategy, which should be presented in 2022. The Council of State took up the issue and submitted a report on the control of illegal recovery of property in 2019.

ats / jfe

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