Swiss politician implicated in bank chief scandal

3rd January 2012, Comments 0 comments

A scandal that threatened the standing of the Swiss central bank chief Philipp Hildebrand turned its focus onto a leading politician and critic of the banker on Tuesday.

Swiss media reported that Christoph Blocher, the outspoken figurehead of the far-right Swiss People's Party, had sparked an investigation into a money transaction by Hildebrand's wife.

Kashya Hildebrand reportedly exchanged a large sum of Swiss francs weeks before the Swiss National Bank moved to devalue the currency by imposing a minimum value against the euro.

The SNB has since said an independent inquiry revealed no foul play.

Le Temps newspaper reported on Tuesday that Blocher delivered extracts from the couple's banking documents to then president Micheline Calmy-Rey after requesting a meeting on December 15.

Blocher, who has been critical of the SNB's 1.20 floor for the franc against the euro, believing it should be higher for the sake of Swiss exports, stoked speculation over his involvement by merely telling media: "There's a time to speak and a time to stay quiet. It is time to stay quiet."

Ms Hildebrand, who runs an art gallery in Zurich, reportedly bought $500,000 on August 15, ahead of the SNB announcement on September 6 that it was to set a floor for the franc against the euro.

The bank acted due to the currency's value soaring amid the euro debt crisis, biting into Swiss exporters' earnings.

After the measure was imposed the dollar gained 10 percent against the franc.

The SNB responded to what it described as "unfounded rumours" in a statement on December 23, saying independent checks had been carried out which found no illegal transaction or exploitation of privileged bank information had occured.

All transactions were examined in detail and "confirmed entirely with regulatory requirements," the central bank said.

Blocher reportedly has strong contacts within the banking community, and in particular with Banque Sarasin in Basel where the transaction was said to have been made. The bank has not commented on the matter.

The Swiss government has said only that it was informed of the transaction and not by whom.

Under Swiss law the head of the central bank is allowed to manage his or her own money dealings, unlike at the Federal Reserve and the European Central Bank where they are obliged to place their assets in a trust administered by a third party.

© 2012 AFP

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