SWITZERLAND Trends and Developments Contributed by: Andrew M. Garbarski, Massimo Chiasera and Louis Frédéric Muskens, Bär & Karrer Ltd
concerned can still dispute the admissibility of such evidence in criminal proceedings, especially invoking the nemo tenetur principle. The FSC’s decision is based on the premise that the duty to collaborate with FINMA no longer applies where the person or entity concerned is exposed to criminal prosecution or if its position in pending or future criminal proceedings could be affected. In the present case, FINMA had invited B SA and A to complete detailed questionnaires by stressing not only their duty to collaborate (Article 29 FINMASA) but also the criminal consequences of conducting unauthorised financial intermediary activities (Article 44 FINMASA) and providing inaccurate information (Article 45 FIN - MASA). In such circumstances, according to the FSC, nemo tenetur applies and prevails over the duty to col - laborate. By failing to inform B SA and A about their right not to incriminate themselves, FINMA breached the nemo tenetur principle, rendering the evidence inadmissible in the FDF’s administrative criminal pro - ceedings opened upon FINMA’s denunciation. The FSC has issued a decision that, while not formally characterised as a landmark ruling, is nevertheless clear and strikingly progressive. Before this point, evidence gathered in administrative proceedings was deemed inadmissible in criminal matters only where it had been obtained through improper compulsion – eg, under threat of criminal sanctions (cf, FSC 142 IV 207, paragraph 8 et seq; FSC 140 II 384, paragraph 3.3; FSC 138 IV 47, paragraph 2.6). This latest FSC decision 7B_45/2022 marks a clear departure from this reasoning, adopting a more rigor - ous approach that offers greater protection under the nemo tenetur principle and avoids its circumvention by law enforcement agencies through administrative proceedings. It is also noteworthy that the FSC expressly states that the nemo tenetur principle applies not only to individuals in this context, but also to legal entities, as soon as they face the risk of criminal prosecution. For example, under Article 102 of the Swiss Criminal Code and/or Article 49 FINMASA. This statement is welcome as it contrasts with past decisions of the
FSC which suggested that the nemo tenetur principle should not provide as much protection for corpora - tions (see FSC 140 II 384, para. 3.3.4). As a result of the FSC decision 7B_45/2022, we antici - pate that: • FINMA will have to proactively inform persons and entities from whom it seeks cooperation of their right not to incriminate themselves, particularly where there is a risk of criminal exposure; • co-operation with FINMA and, ultimately, the lat - ter’s supervisory activities could be affected where the relevant parties rely on their right not to incrimi - nate themselves; and • the outcome of pending criminal proceedings which rely on evidence collected by FINMA in breach of the nemo tenetur principle might be sig - nificantly affected. How this FSC decision impacts the interaction between administrative and criminal proceedings out - side the financial industry will also have to be moni - tored. There are indeed many other legal fields (eg, tax law) where the duty to co-operate with the adminis - trative authorities often paves the way for a criminal prosecution, and, ultimately, a conviction. Conclusion The FSC’s decision in case 7B_45/2022 marks a sig - nificant shift in the treatment of evidence collected by FINMA for use in criminal proceedings. The FSC made clear that the right not to self-incriminate (nemo tenetur) takes precedence over the statutory duty to cooperate with FINMA whenever there is a risk of criminal liability. As a result, evidence obtained from individuals or enti - ties without a proper warning of this right is inadmis - sible in subsequent criminal proceedings. This development obliges FINMA to inform parties of their right to remain silent in situations involving potential criminal exposure, and it provides affected persons and entities with stronger grounds to challenge the admis - sibility of such evidence. The decision is likely to have a broader impact on the interaction between administra - tive and criminal proceedings, both within and beyond the financial sector, as authorities and courts adapt to these reinforced procedural safeguards.
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