How To Launder Money – Swiss Style

Email Print
FacebookTwitterShare

     

An interesting crime story has come out in France and Switzerland. It may prove to be the nail in the coffin for bank secrecy in Switzerland.

The Swiss and French police arrested seventeen individuals a week ago (including an assistant Mayor in Paris). A woman (known only as “M”) is the center of attention of a drug smuggling ring. Apparently she ran a very big operation smuggling marijuana from Morocco into France.

Authorities followed the money from the drug operation from France to Geneva, Switzerland, where the loot was laundered through HSBC and GPF SA (never heard of them). This was a family affair; M’s brothers were working for the Geneva based banks.

The money laundering operation is an interesting part of the story. The sequence of events:

A) The drug operation generated big amounts of small denomination Euro bills.

B) The cash from drug sales all over France were brought back to Paris.

C) M’s brothers in Geneva knew wealthy individuals in France (and presumably Germany too) who had “Black Accounts” in Switzerland. (Nothing to do with the drug smuggling)

D) Individuals who have Black Accounts in Switzerland have a noose around their neck. Switzerland (with a gun to its head) is negotiating tax treaties with all of its neighbors that would result in divulging the “names” of the account holders.

E) European Black Account holders know the clock is ticking. They know the result will be that they will lose all, or a big part, of the money they have stashed in Swiss banks. (That’s what happened to the US “names”)

F) Black Account holders want their money back, but they can’t transfer the money to another bank, as bank wire transfers are completely transparent to authorities.

G) The only solution for Black Accounts is to get access to cash. This is very hard to do, as there are guards on Swiss borders, and one can’t really trust the Swiss bankers any longer.

Read the rest of the article

Email Print
FacebookTwitterShare
  • LRC Blog

  • LRC Podcasts