Switzerland Fighting for Improved Reputation

Switzerland, a country long known for its bank secrecy laws, is attempting to fight that reputation by playing a leading role in the effort to return stolen state assets.

Valentin Zellweger, a legal adviser at the Swiss foreign ministry, said the country has been working on returning stolen assets for decades. He cited Swiss efforts dating back to the 1980s and 1990s to return assets stolen from the Philippines by late Philippine President Ferdinand E. Marcos and his family.

“We had to act because we had a reputation problem, and we’re conscious of it,” said Mr. Zellweger. “People think all the illegal funds are in Switzerland, which is by far not true.”

Mr. Zellweger said the issue grabbed the spotlight after the revolutions in the Arab world began in late 2010. Switzerland responded by freezing and returning millions of dollars in stolen assets to Egypt and Tunisia, both of which have new governments.

The Swiss government, in association with the Stolen Asset Recovery Initiative, or StAR, which is a partnership between the United Nations Office on Drugs and Crime and the World Bank Group, will host an Arab Forum on Asset Recovery summit next week in Geneva.

Films like “Casino Royale” and “The Wolf of Wall Street” haven’t done much to improve the country’s reputation as a haven for corrupt money, said Mr. Zellweger.

“There is a popular image of Swiss bankers, but we haven’t managed to change that popular perception of Swiss banks,” he said. “If you look at the World Bank report, we can prove it no longer corresponds to reality.”

According to a StAR study conducted in September, Switzerland froze more than half of the $1.4 billion in assets frozen by member countries in the Organization for Economic Cooperation and Development and gave back about $20.2 million of the $147.2 million returned to the countries from which it was stolen.

Asset recovery doesn’t come without its challenges, however. Mr. Zellweger noted that while “It sounds simple to send money back” there are numerous judicial hoops that must be navigated. Also, estimates of the value of the assets tend to be vastly inflated and proving a negative about the money can be difficult.

Source: Rubenfeld, Samuel, “Switzerland Fights Reputation as Cash Stash House,” The Wall Street Journal, October 23rd, 2014