Money Laundering, Tax Evasion and Swiss Bank Accounts

The allure of a Swiss bank account is vanishing with each passing day. The accounts, long associated with a treasure trove of ill-gotten gains, laundered money of drug barons and tax evasion, met their match in the form of the Foreign Account Tax Compliance Act and are being steam rolled into complete complianceRecent coverage of the impact of FATCA on the Swiss financial system indicates that the Swiss have recently signed a bilateral agreement with the UK that has features similar to the U.S. born FATCA.

The regulatory actions, by the US and international financial regimes, are great in theory.  However, as history shows, the role of the gatekeeper (and the gatekeeper himself) in tax evasion and money laundering schemes is frequently far more critical to the success and longevity of the scheme than the bricks and mortar institutions that house the accounts.  Gatekeepers, according to the Financial Action Task Force, “protect the gates to the financial institutions” and have been used to create corporate vehicles, open bank accounts, transfer proceeds, purchase property, courier cash, and take other means to bypass AML controls.  For more the complicity of financial institutions in money laundering and terrorist financing schemes see this post or this Forbes article on Wegelin & Co.

Analysts and investigators tasked with investigated money laundering suspicious financial activity would be wise to consider the role of gatekeepers as facilitators of sophisticated schemes and the concept of willful blindness. For more information on training and available resources contact Analysts Compass.

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