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Switzerland Bolsters Anti-Money Laundering Rules: Targeting Trusts and Enhancing Accountability

Due DiligenceSwitzerland Bolsters Anti-Money Laundering Rules: Targeting Trusts and Enhancing Accountability

Switzerland has introduced new rules to strengthen its anti-money laundering regulations, aiming to address perceived gaps. The rules, created by the Swiss government, are designed to increase accountability among lawyers and consultants in reporting risks. They also aim to enhance oversight of legal entities like trusts. The proposed regulations will be presented to parliament in 2024 after undergoing consultation.

Switzerland, known for its substantial offshore wealth management industry, has been working to shed its historical association with facilitating illicit financial activities. The country actively shares bank account information with over 100 nations. However, it has faced international pressure to increase transparency around corporate ownership, where entities like trusts can obscure the true beneficiaries’ identities.

If adopted, the new rules would subject lawyers, accountants, and other consultants who establish trusts, holding companies, or arrange real estate transactions to due diligence requirements and reporting obligations. The regulations would also reinforce obligations for banks, companies, and service providers to scrutinize and manage risks related to sanctions violations among their clients, a particularly relevant issue since Russia’s Ukraine invasion.

The proposed rules would extend due diligence to all future real estate transactions and impose anti-money laundering checks on cash payments for precious metals and gemstones (e.g., gold, diamonds) valued above 15,000 Swiss francs ($17,055.14), down from the current threshold of 100,000 francs.

By FCCT Editorial Team

Disclaimer: The views expressed in this article are independent views solely of the author(s) expressed in their private capacity.

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