Fresh Fears of Swiss Blacklisting.

(Swiss Finance Minister: Image courtesy Reuters)

Proposed modifications to recommendations by the Financial Action Task Force (FATF) by Swiss law-makers have fuelled fears of Switzerland’s re-branding as ‘uncooperative’ by the OECD.

The plan that has raised the ire of the Swiss Finance Minister would see an adjustment in the threshold which would trigger the characterisation of a serious tax offence as ‘tax evasion’.

To be fair, recent experience shows that Minister Eveline Wider-Schlumpf is right to be concerned.

Though referred to as ‘Recommendations’ the 40 +9 rules FATF are recognised as the international standard for

  • combating money laundering;
  • financing of terrorism; and
  • the proliferation of weapons of mass destruction.

Importantly too, according to the FATF “they form the basis for a global response to these threats to the integrity of the financial system and help ensure a level playing field.”

As many international and offshore financial centres already know, such co-ordinated activity includes the ‘blacklisting’ of a country as ‘uncooperative‘ for failure to apply the standard to the letter and in the prescribed time-frame.

As part of the obligations of the FATF’s  thirty-four (34) member jurisdictions Switzerland must provide biennial up-dates on its progress in applying the Recommendations.

Switzerland’s next scheduled onsite visit by an FATF delegation is in June or July next year.

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