Endless curve

Monday, 18 October 2021

Over 20 years ago, when international money laundering standards started to emerge, the legal framework was intended to enable the identification and seizure of assets derived from criminal activities. Nowadays, legislation is being introduced that allows authorities to take not only repressive but also preventative measures.

In line with the Financial Action Task Force Recommendations, the scope of the anti‑money laundering compliance regime has constantly expanded to new areas and businesses. In addition, the amount of information that financial intermediaries are required to collect has increased, and sharing of such information has become ever easier.

To use my home turf as an example, Switzerland has constantly followed this international trend so that the Swiss financial market has been transformed in a way only few would have ever imagined. From its legendary banking secrecy, we have arrived at new legislation, introduced in July this year, giving the Money Laundering Reporting Office Switzerland (MROS) expansive authority in the area of information exchange. Under the new provisions, MROS will be able to request information from Swiss financial intermediaries on transactions or business relationships reported by a foreign authority (through spontaneous information or a request made by a foreign authority), even when a Swiss financial intermediary has not submitted a suspicious activity report to MROS.

This issue of the STEP Journal focuses on compliance; the journey towards transparency is not over yet and the pipeline of forthcoming regulation in various jurisdictions is impressive. We also learn, in the article penned by Grensy Quintero, Kenneth Bransom and Ahmed Cassim, that the US – after imposing the Foreign Account Tax Compliance Act on the rest of the world and not participating in the Common Reporting Standard – has introduced a new Corporate Transparency Act and is starting to collect data about beneficial owners. Does this mean that the world will soon be able to link every asset and every transaction to an individual beneficial owner? Will this be the end of the journey?

There remains the hope that the regulation, while not increasing costs for the majority and providing jobs for people in its industry, also achieves its main purpose set at the outset.

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Gian Andri Töndury

Gian Andri Töndury TEP is a member of the STEP Journal Editorial Board and a Partner at Umbricht Attorneys in Zurich, Switzerland.

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