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Article
Publication date: 1 July 2004

Spero C. Peppas

Switzerland has long been known as a world leader in the financial services arena. However, in recent years the Swiss banking industry has come under considerable attack…

2015

Abstract

Switzerland has long been known as a world leader in the financial services arena. However, in recent years the Swiss banking industry has come under considerable attack, in particular with regard to money laundering, Holocaust accounts and European Union tax evasion issues. This article examines Swiss banking confidentiality, reports perceptions of a sample of US Americans with regard to banking secrecy, and compares and contrasts perceptions with reality. The results of this study indicate that the general public holds negative perceptions of Swiss banking practices. This article should serve to correct misperceptions of Swiss banking held by the public at large and should be of particular interest to those involved in Swiss banking and the marketing of financial services.

Details

Management Research News, vol. 27 no. 7
Type: Research Article
ISSN: 0140-9174

Keywords

Article
Publication date: 2 January 2018

Aidan Carlin and Mark Eshwar Lokanan

This paper aims to highlight the relationship between money laundering and the patterns of behaviour evident throughout the larger structural environment of the Swiss

Abstract

Purpose

This paper aims to highlight the relationship between money laundering and the patterns of behaviour evident throughout the larger structural environment of the Swiss banking sector. In particular, the paper used HSBC as a prototype case of structural ritualisation to show that the normalisation of corrupt, unethical behaviour in the banking environment has shaped and influenced the behaviour and actions of the embedded group actors.

Design/methodology/approach

The paper used a content analysis methodological approach of media sources to collect data. The content analysis was categorised into six core ritualised symbolic practices (RSP) categories – corruption, reputation, blame, ignorance, regret and criticism.

Findings

The findings reveal that the highly ranked RSPs involving corruption, reputation, blame, regret, ignorance and criticism influence the embedded group’s patterns of behaviour, and they formed part of the cognitive script that dictated their behaviour and actions in the Swiss banking sector.

Practical implications

The paper added to the calls by Swiss policymakers for amendments to Swiss bank secrecy laws to reflect the changing landscape of international banking and finance.

Originality/value

This is the first paper of its kind to study ritualised illegal practices related to money laundering in the Swiss banking sector.

Details

Journal of Money Laundering Control, vol. 21 no. 1
Type: Research Article
ISSN: 1368-5201

Keywords

Article
Publication date: 4 June 2020

Fabian Maximilian Johannes Teichmann and Marie-Christin Falker

This case study highlights why and how the Swiss banking sector played a crucial role in the 1Malaysia Development Berhad (1MDB) corruption scandal. In particular, the…

1043

Abstract

Purpose

This case study highlights why and how the Swiss banking sector played a crucial role in the 1Malaysia Development Berhad (1MDB) corruption scandal. In particular, the paper illustrates how different actors in the Swiss financial sector neglected compliance guidelines and due diligence, thus effectively facilitating the laundering of misappropriated 1MDB funds. The purpose of this paper is to give bankers and compliance officers an overview of the methods money launderers use to circumvent compliance measures so that the Swiss banking sector can be protected more effectively from abuse. In addition, there is discussion whether current regulations, including banking secrecy, should be amended.

Design/methodology/approach

This paper used a content analysis methodological approach to collect data from media sources. Qualitative methods were used to analyze these sources.

Findings

The findings reveal that the Swiss banking sector played a major role in facilitating the siphoning and subsequent laundering of 1MDB funds by neglecting due diligence obligations.

Practical implications

This paper advocates a more consequential implementation of the existing anti-money laundering and corruption regulations.

Social implications

A reworking of the 1MDB scandal should be of interest to compliance professionals in the banking sector and citizens that have been negatively affected or are concerned by the involved high-level corruption.

Originality/value

This paper is the first of its kind to study the role of the Swiss banking sector in the 1MDB scandal.

Book part
Publication date: 29 August 2017

David Chaikin

The principal issue that will be considered in this chapter is how the banking sector facilitates the crimes of money laundering and tax evasion. This will entail asking a…

Abstract

The principal issue that will be considered in this chapter is how the banking sector facilitates the crimes of money laundering and tax evasion. This will entail asking a series of related questions. Does the assistance of the banking sector in financial crime involve a small number of wayward employees at the periphery of banking? Or are multinational financial institutions willing participants in the systemic evasion of global antifinancial crime standards? In exploring these questions, the theory and practice of money laundering will be explored by focusing on the three stages of the money laundering cycle. The global anti-money laundering standards that apply to the banking sector, and the role of bank secrecy in promoting tax evasion, will be examined through a series of case studies. It will be argued that there is strong empirical evidence that the banking sector is a systemic offender facilitating financial crimes, despite the enactment of international and national antifinancial crime standards and criminal prosecutions of financial institutions.

Details

The Handbook of Business and Corruption
Type: Book
ISBN: 978-1-78635-445-7

Keywords

Article
Publication date: 1 December 2002

Eva H.G. Hüpkes

On 9th July 2002, the Swiss Federal Banking Commission (SFBC) published for consultation a proposal for a new SFBC Money Laundering Regulation. The draft regulation…

2784

Abstract

On 9th July 2002, the Swiss Federal Banking Commission (SFBC) published for consultation a proposal for a new SFBC Money Laundering Regulation. The draft regulation proposes stricter rules for banks and securities dealers to prevent money laundering and financing of terrorism and details specific due diligence requirements with respect to business relationships with politically exposed persons. The draft incorporates the lessons drawn from money laundering cases in Switzerland as well as international developments.

Details

Journal of Financial Regulation and Compliance, vol. 10 no. 4
Type: Research Article
ISSN: 1358-1988

Keywords

Article
Publication date: 8 March 2022

Fabian Maximilian Johannes Teichmann and Chiara Wittmann

The purpose of this paper is to illustrate threefold how hawala banking poses a problem for Swiss banks implementing anti-money laundering (AML) and anti-terrorist…

Abstract

Purpose

The purpose of this paper is to illustrate threefold how hawala banking poses a problem for Swiss banks implementing anti-money laundering (AML) and anti-terrorist financing (ATF) policies as a fulfilment of Switzerland’s UN commitment.

Design/methodology/approach

The first author interviewed compliance officers and suspected criminals on hawala banking mechanisms. The authors formally recorded interviews with compliance officers, but interviews with suspected criminals were not recorded to maximize their potential forthrightness. In total, the authors conducted 70 formal interviews and developed a questionnaire based on this, which was sent to 200 compliance officers. The authors subjected the interviews to qualitative analysis and developed a system of categories that the authors assessed by means of triangulation. By substantiating proposed theoretical challenges with empirical findings, future recommendations for regulatory procedures are based on analytical evidence.

Findings

This study finds that hawala presents significant challenges for AML and ATF policies. Whilst it is possible to mediate the first two challenges laid out herein, it is the third hurdle that proves insurmountable. Ultimately, tolerating hawala banking passively counteracts any active effort made by implementing AML and ATF policies.

Originality/value

Whilst the existing literature sufficiently connects hawala banking to terrorist financing, this study details how existing compliance measures are circumvented and the implications on the perceived commitment of Switzerland against financial crime.

Details

Journal of Money Laundering Control, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1368-5201

Keywords

Article
Publication date: 1 August 2016

Daniel Vogler, Mario Schranz and Mark Eisenegger

The concept of media reputation is a well-documented field in communication research. However, it often remains unclear how the process of reputation formation takes place…

1472

Abstract

Purpose

The concept of media reputation is a well-documented field in communication research. However, it often remains unclear how the process of reputation formation takes place exactly. The purpose of this paper is to analyze which stakeholder groups are the driving forces in the process of reputation constitution of the Swiss banking industry and how it was affected by the financial crisis in 2008.

Design/methodology/approach

Given that mass media are the main source of information about an organization in crisis for the public, media reputation serves as a valuable concept for analyzing the effects of crises on organizations. This study is therefore based on a content analysis of Swiss newspapers published between 2004 and 2010.

Findings

Data shows that the influence of political stakeholder groups on media reputation of Swiss banks is higher in times of crisis. In addition the focus in media coverage changes from economic topics in pre-crisis period to social topics in crisis period. The increased importance of political stakeholder groups and social topics in crisis lead to a more negative and less controllable media reputation.

Originality/value

This study aims at a better understanding of the impact of stakeholder groups on corporate media reputation in crises. Instead of defining reputation as a single item this approach allows a more differentiated analysis of the process of reputation constitution.

Details

Corporate Communications: An International Journal, vol. 21 no. 3
Type: Research Article
ISSN: 1356-3289

Keywords

Article
Publication date: 1 January 1998

Tracy S. Paradise

One cynic has speculated that years hence people will look back and be forced to conclude that ‘money laundering was one of the greatest problems facing mankind towards…

Abstract

One cynic has speculated that years hence people will look back and be forced to conclude that ‘money laundering was one of the greatest problems facing mankind towards the end of the second millennium’. This would be true of lawyers, politicians, economists, sociologists and many others who have sought to examine the problem, each from their own viewpoint. Yet, the persis‐tently non‐definable trend of globalisation has seemingly demonstrated that uni‐causal or uni‐disciplinary explanations of change in the international arena tend to yield unilateral perspectives on problems, solutions to which are subsequently limited in scope.

Details

Journal of Money Laundering Control, vol. 1 no. 3
Type: Research Article
ISSN: 1368-5201

Article
Publication date: 1 January 1998

Alan Gart and Edward M. Pierce

This paper examines the strategies and financial ratios of the largest U.S. and European banks. Why are bank profitability ratios in the U.S. and U.K. vastly superior to…

Abstract

This paper examines the strategies and financial ratios of the largest U.S. and European banks. Why are bank profitability ratios in the U.S. and U.K. vastly superior to those in Germany and Switzerland? Is this related to accounting, tax, economic, or regulatory differences, uses of funds, or management quality?

Details

Studies in Economics and Finance, vol. 19 no. 1/2
Type: Research Article
ISSN: 1086-7376

Article
Publication date: 7 January 2019

John Liebeskind

This paper aims to discuss the compliance duties of Swiss banks toward the Chinese exchange control in case of PRC residents’ deposits.

Abstract

Purpose

This paper aims to discuss the compliance duties of Swiss banks toward the Chinese exchange control in case of PRC residents’ deposits.

Design/methodology/approach

The paper matches the Swiss regulatory framework and practice in matter of banks diligence with that of the PRC exchange control and tentatively identifies the consequences resulting thereof for Swiss banks.

Findings

The paper finds that exchange control does fall within the scope of the Diligence Code. It suggests that banks should broadly interpret the related provisions. While in case of infringement, Chinese penalties can still be rated as a remote and moderate threat, they might strengthen. Meanwhile, the Swiss ones, under the Code, are serious.

Research limitations/implications

The paper does not cover other forms of overseas investment from China, namely, commercial investment. Besides, there is no related jurisprudence or practice as of yet; therefore, the findings of the paper need to be tested.

Practical implications

The paper suggests that the compliance officers of Swiss banks should familiarize themselves with the specificities of the PRC exchange control to anticipate the related risks.

Originality/value

Sino-Swiss compliance and bilateral assistance in financial matters are still unchartered waters. Because the Greater China market is of growing significance for Swiss banks, they might welcome early guidance to avoid repeating their mistakes with the USA and the EU.

Details

Journal of Money Laundering Control, vol. 22 no. 1
Type: Research Article
ISSN: 1368-5201

Keywords

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