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Swiss: fine Zurich bankers for money laundering

Published on 07/08/2008

7 August 2008

BELLINZONA – Swiss prosecutors on Wednesday demanded fines of up to CHF 40,000 for five Zurich bankers on trial for allegedly helping a ring of corrupt Brazilian tax officials launder USD 45 million (CHF 47.5 million).

Prosecutor Brent Holtkamp also urged the Federal Criminal Tribunal to give the bankers suspended prison terms of between 18 months and 30 months – sentences that would take effect if those convicted commit further crimes during that time.

The five have not been publicly identified because of Switzerland’s strict privacy laws, but they include the former director of the Zurich branch of the now-defunct Discount Bank & Trust Cie, the head of the bank’s South America business, its chief legal council and two other bank employees.

The bankers are accused of having kept accounts at the bank for Brazilian tax inspectors and high-ranking officials from Brazil who invested USD 45 million worth of cash allegedly obtained through criminal activities.

The trial began in June but was suspended until Wednesday. All five say they are innocent.

Holtkamp said all five defendants knew the transactions were illegal, the money-laundering lasted for months and involved a large number of accounts and banking transactions. He said the Swiss government should confiscate the USD 45 million.

The lawsuit in Switzerland is one of a series in the two countries involving Brazilian tax authorities who demanded bribes for helping companies and individuals evade millions of dollars in taxes by depositing money in Swiss banks.

In Brazil, 22 tax inspectors and ring leader Rodrigo Silveirinha were convicted and sentenced to prison terms ranging from two years and six months to 20 years and six months. In 2007, a higher court confirmed their imprisonment for money laundering and corruption.

Swiss officials, who have provided judicial assistance to Brazil in the case, began their own investigation in 2001 after Discount Bank & Trust was taken over a by a Geneva-based bank, which reported a number of financial irregularities to authorities.

No date has been set yet for the verdict.

Switzerland, embarrassed in past years that its banking secrecy rules fostered a reputation of a safe haven for the funds of dictators and other corrupt foreign officials, has stepped up its fight against money laundering.

Reforms over the last two decades have made it harder to hide money in Switzerland, and the country has become a world leader in returning cash to injured governments.

[AP / Expatica]