SWITZERLAND Trends and Developments Contributed by: Jean-Marc Carnicé, Canonica Valticos Carnicé & Associés
duty to report under Article 37 AMLA, and pro - vided important clarifications that strengthen and tighten the interpretative framework of this obligation. The matter involved large, unexplained transac - tions through accounts flagged as high risk. The Criminal Chamber of the Federal Criminal Court identified several red flags indicating a potential money laundering scheme, such as: • unclear economic purpose; • inconsistency of the transactions with the cli - ent’s profile; • rapid fund movements; and • vague or contradictory justifications. Despite these indicators and the clients’ refus - al to co-operate, the bank failed to notify the MROS. The court held that once clarifications failed to dispel the suspicion, a report was man - datory. This case reaffirmed that the reporting duty is triggered not by certainty, but by the presence of a founded suspicion. In this case, the accu - mulation of red flags was sufficient to meet that threshold. This ruling underscores that the duty is reac - tive to risk, not to conclusive proof. It marks a shift toward a more proactive and risk-sensitive compliance culture, underscoring that financial institutions must respond not only to isolated anomalies but to patterns that point toward potential money laundering. The decision clearly rejects “wait and see” approach once concrete indicators of risk are present, and thus reinforces a proactive stance in compliance operations, ensuring earlier escalation to the MROS.
When does the duty end? Ordinance of the Criminal Chamber of the Federal Criminal Court of 29 April 2024 (SK.2023.3) Completing the duty’s “life cycle” , this case addressed its conclusion – specifically, the moment at which a financial intermediary’s obli - gation to report under Article 37 AMLA is con - sidered fulfilled. Adopting a functional approach, the Criminal Chamber of the Federal Criminal Court empha - sised that the duty to report under Article 37 AMLA serves the critical purpose of safeguard - ing assets and facilitating enforcement action. This obligation is only considered fulfilled when the core objective – preventing the dissipation of potentially illicit funds – has been achieved. This decision clarified that the reporting obli - gation does not necessarily cease upon the authorities being seized of the case through a denunciation, or upon the opening of an inves - tigation. Moreover, the receipt of a third-party criminal complaint reporting suspicions of mon - ey laundering does not absolve the financial intermediary of their duty to report, as long as the possibility of tracing and seizing the disputed assets remains. It follows that the duty to report only ends when the criminal authorities have obtained the relevant information necessary for identifying and seizing the assets in question. In practical terms, once assets are seized, they are no longer at risk of evading the control of law enforcement, effectively concluding the report - ing obligation. In other words, the obligation to report ends when the criminal authorities are aware of the fate of the assets that may be linked to money laundering, not only when the criminal authori - ties are notified of suspicions of money launder - ing. Indeed, the duty to report aims to trigger
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