BEFORE YOU GO...
Check how Shufti Pro can verify your customers within secondsRequest Demo
The Swiss government plans to set up a central registry for beneficial ownership, a step that indicates a significant shift in the country’s financial sector.
Recently, the cabinet requested the Ministry of Finance to draft proposals by the mid of 2023 that may just make it simpler to identify corporate owners. The move seeks “to strengthen the prevention and prosecution of financial crime and thus the integrity and reputation of [Switzerland as a] financial center and business location,” reported Reuters.
Switzerland is renowned for being one of the most significant financial centers across the globe, yet in the past, people who wanted to conceal illicit funds have misused long-standing banking secrecy regulations.
The government has pushed to boost transparency in the financial industry and exchange more data with foreign countries to combat financial crimes including money laundering.
The government has proposed extending Anti-money Laundering (AML) rules to cover the legal system in addition to the idea to track corporate ownership. However, only financial intermediaries are subject to the law’s due-diligence requirement. But it’s important to remember that the Swiss parliament opposed a similar attempt last year to broaden the reach of AML regulations.
A registry of firm ownership will be essential in the battle against money laundering given that it will make it more difficult for criminals to employ shell companies to conceal the ultimate beneficiaries of the funds. According to the government, “relevant authorities” would be the only ones who can access the recorded data; it won’t be available to the public.
Corporate transparency is a partisan matter in a number of countries, not only in Switzerland. As PYMNTS noted, various pieces of legislation are also put out in the U.K. to aid in identifying firm ownership and make it more difficult to conduct business through offshore shell companies.
Suggested Read: Swiss Watchdog FINMA Mandates AML Policies on Crypto