I. Introduction

1 The exchange of information between national authorities and the Money Laundering Reporting Office Switzerland MROS is regulated in the first section of the fourth chapter of the Anti-Money Laundering Act. MROS is at the center of these administrative assistance regulations.

2 The legal mandate of MROS can be divided into three main areas of responsibility: Intelligence (analysis of reports of suspicions and forwarding to law enforcement authorities), prevention (strategic analysis, risk detection, methods and trends, awareness-raising) and cooperation (administrative assistance).

3 Cooperation, i.e. the exchange of financial information, is of the utmost importance and a cornerstone of international efforts to combat money laundering, terrorist financing and the associated predicate offences. MROS acts as the linchpin of this system. In cases where only fragmented information is available, MROS can play a substantial role in piecing together the full picture and forward the (consolidated) information to the authorities.

4 The aim of national administrative assistance must be to ensure an efficient flow of information, to coordinate investigations, to increase transparency and to support criminal prosecution. It is a central element in protecting the integrity of the financial center and the financial system and effectively combating illegal activities. Money laundering and terrorist financing can only be counteracted if information can be transmitted quickly and completely. To carry out this task efficiently, MROS requires appropriate administrative assistance provisions that keep the hurdles for exchanging information as low as possible. The administrative burden of transmitting information, which ultimately has a significant impact on human resources, must also be kept to a minimum, as far as national and international requirements allow.

5 The exchange of information between the prosecution authorities and MROS under the administrative assistance provisions (Art. 29 para. 2^bis AMLA) must be distinguished from the reporting to the prosecution authorities under Art. 23 para. 4 AMLA. If MROS concludes on the basis of its analysis that there is a suspicion of money laundering, its predicate offenses, organized crime, terrorist financing or a lack of due diligence in financial transactions, it is obliged under Article 23 para. 4 AMLA to report the matter to the competent law enforcement authority. Unlike a report, however, the exchange of information under Art. 29 para. 2^bis AMLA is subject to the restrictions on use under Art. 29 para. 2^bis AMLA in conjunction with Art. 30 paras. 2–5 AMLA, which define the content and form of the information transmitted, but also provide for restrictions on the use and disclosure of this information (see OK-Triller, Art. 29 AMLA, N. 34 below). The distinction between a report pursuant to Art. 23 para. 4 AMLA and an exchange of information through administrative assistance is therefore of central importance when it comes to the question of the usability of the information received by the prosecuting authorities.

II. Requirements for national administrative assistance pursuant to Art. 29 para. 1 AMLA

6 Art. 29 para. 1 AMLA governs national administrative assistance between MROS and supervisory authorities. The authorities mentioned in the law may provide each other with any information they require for the application of the AMLA.

A. Definition of authorities according to Art. 29 para. 1 AMLA

7 The following are covered by the wording of the law according to Art. 29 para. 1 AMLA: the Swiss Financial Market Supervisory Authority FINMA, the Federal Gaming Board FGB, the intercantonal authority (Intercantonal Supervisory and Enforcement Authority according to Art. 105 of the Gambling Act), the Central Office (for Precious Metals Control) and MROS, whereby this list is exhaustive.

8 Art. 29b AMLA provides a separate legal basis for the exchange of information with self-regulatory and supervisory organizations. The content of the regulation is practically identical to that of Art. 29, para. 1 AMLA.

B. Optional provision

9 Article 29, para. 1 AMLA is an “optional provision” (Kann-Bestimmung). The decision to provide administrative assistance is therefore at the discretion of the supervisory authorities and MROS.

10 In MROS practice, administrative assistance is the general rule. MROS only refuses administrative assistance in exceptional cases, when justified, or when the conditions of Article 29, para. 1 AMLA are not met.

C. The purpose limitation as a barrier to the exchange of information

11 The exchange of information between MROS and the supervisory authorities is limited to the “application of the Anti-Money Laundering Act”. This purpose limitation stipulates which information the authorities can exchange with each other.

12 The article of purpose of the AMLA states that the law regulates the fight against money laundering, the fight against terrorist financing and the ensuring of due diligence in financial transactions. The latter also includes the due diligence obligations of financial intermediaries, the obligations in the event of suspected money laundering and the obligation to disclose information. Thus, information that may indicate a violation of money laundering provisions under supervisory law (violation of due diligence obligations, violation of the reporting requirement, etc.) may be exchanged with the authorities in accordance with Art. 29 para. 1 AMLA. On the other hand, Art. 29 para. 1 AMLA does not provide a legal basis for the transmission of information that, for example, relates exclusively to another special or (financial market) law and thus has no connection with the application of the Anti-Money Laundering Act.

D. Content of the information exchange

13 The supervisory authorities and MROS may provide each other with “all information” for the purpose of applying the AMLA. This includes all information in the internal goAML information system and any other information held by MROS. This information may include personal data, sensitive personal data and financial information. For example, this includes information on: date of receipt of the report, content of the suspicious activity report (transactions), contracting partner, beneficial owner, date of transmission to the law enforcement agency.

14 In the case of a request for administrative assistance, the information must be limited to the subject of the request (need-to-know principle / proportionality). No further information may be provided. However, MROS may provide additional information on its own initiative in response to a request if the conditions are met.

E. Form and nature of the information

15 The authorities mentioned in Art. 29, para. 1 AMLA may provide each other with any “information” they need to apply the law. However, it is not clear from the wording of the law whether the information includes the exchange of documents or only summary compilations.

16 The transmission of “documents” was deleted from the legal text of Art. 29 para. 1 AMLA with the revision of the Anti-Money Laundering Act as of January 1, 2023. This means that no (original) documents may be exchanged. The reason given for this was that MROS, as an administrative authority, produces “financial intelligence” and is therefore not allowed to exchange any documents that could be used in administrative or criminal proceedings.

17 This argument is open to criticism from today's perspective. The fact that the authorities mentioned in Article 29, para. 1 AMLA can provide each other with any information they need to apply the AMLA is undisputed. Similarly, there is no restriction on national information not being included in procedural files. The fact that no (original) documents are exchanged means that the information must be transmitted in a report form. This causes a considerable administrative and time overhead for all authorities involved.

18 The exchange of information can be done orally, electronically or on paper. Consequently, the decision on the method of providing information is left to MROS and the individual supervisory authorities, although a written exchange is preferred (for reasons of traceability and with a view to maintaining official secrecy).

III. Requirements for national administrative assistance under Art. 29 para. 2 AMLA

19 Art. 29 para. 2 AMLA governs the transmission of information from third-party authorities to the reporting office. The reporting office may, upon request, obtain from federal, cantonal and municipal authorities all the data it requires for the analysis to combat money laundering, its predicate offenses, organized crime or terrorist financing.

A. Covered authorities

20 Art. 29 para. 2 AMLA applies to all federal, cantonal and municipal authorities that hold relevant information that may be relevant for the analysis of the reporting office or the federal criminal police headquarters. According to the message, this also includes the tax authorities, customs authorities, land registry offices and residents' registration offices.

B. Obligation to surrender upon request

21 If the conditions of Article 29, para. 2 AMLA are met, the authorities shall transmit the information to MROS and the Federal Criminal Police at their request, provided that the special laws applicable to the authorities in question do not provide for other restrictions that prevent disclosure.

C. Content of the information exchange

22 MROS may request from the authorities basically all information required for its operational analysis activities (combating money laundering, its predicate offences, organized crime and terrorist financing). This includes in particular financial information as well as other personal data worthy of protection that is gathered in criminal, administrative penal and administrative proceedings, including such data from pending proceedings. Art. 7 MLO further specifies the information content.

IV. Requirements for national administrative assistance in accordance with Art. 29 para. 2^bis AMLA

23 Art. 29 para. 2^bis AMLA regulates the transmission of information from MROS to third-party authorities in return for para. 2. The legal norm is difficult to apply, in particular due to its norm complexity.

A. Definition of authority in accordance with Art. 29 para. 2 AMLA

24 Art. 29 para. 2^bis AMLA refers to the definition of “authorities” to which MROS can provide administrative assistance in para. 2 of the aforementioned provision. This includes federal, cantonal and municipal authorities. However, the scope of application is limited to the use of information in accordance with Art. 29 para. 2^bis AMLA for those authorities that are active in the fight against money laundering, its predicate offences, organized crime or terrorist financing.

25 In principle, the law enforcement authorities are also covered by the scope of application. This applies in particular to spontaneous information or requests for administrative assistance without a prior formal report under Article 23, para. 4 AMLA by the MROS. If a report has been filed, it must be determined whether new findings can be transmitted in the sense of supplementing the report. If this is not the case, then only the mutual assistance route is possible. The same conditions apply to the exchange of information as with the other authorities. This means that the prosecuting authorities only receive the information in report form and this is subject to the restrictions on use (Art. 29 para. 2^bis AMLA in conjunction with Art. 30 para. 2– 5 AMLA).

26 To determine which authorities are active in combating money laundering, it is first necessary to define what is covered by the term money laundering. The AMLA does not provide a definition in this regard.

27 Art. 305^bis no. 1 SCC describes an act that typically makes it more difficult to determine the origin, locate or confiscate assets. This covers a wide range of actions, from mere concealment to failure to report to MROS. This makes it possible to exchange information with the authorities that combat such behavior and thus help to prevent the assets obtained by criminal means from remaining unseized. Money laundering is a secondary offense and requires a predicate offense, i.e. an upstream offense. The predicate offences are crimes under Art. 10 para. 2 SCC or a qualified tax offence. As such, those criminal offences under the Special Part of the SCC and the ancillary penal legislation for which the abstract penalty range is more than three years' imprisonment are considered. If an authority is responsible for prosecuting crimes, MROS can in principle provide administrative assistance.

28 Furthermore, the AMLA does not define the terms “organized crime” and “terrorism financing”. Organized crime is not explicitly included in the scope of the AMLA. However, Art. 29, para. 2 AMLA expressly states that information may also be exchanged with authorities that use the information to combat organized crime. By analogy, reference can be made to the corresponding criminal offence of criminal and terrorist organization under Art. 260^ter SCC.

29 Anyone who finances a violent crime intended to intimidate the population or to coerce a state or an international organization to perform or refrain from performing an act, or who collects or provides assets to that end, is liable to prosecution for financing terrorism (Art. 260^quinquies para. 1 SCC). However, terrorist financing does not require a predicate offense. Furthermore, there is no uniform definition of “terrorism”.

B. Optional provision

30 As with Art. 29 para. 1 AMLA, Art. 29 para. 2^bis AMLA is an “optional provision”, which is supplemented by the expression “in individual cases”. This stipulates that no automatic data exchange may take place between MROS and the other public authorities. MROS must always weigh the circumstances and decide in the light of the specific situation whether it is legally permissible, appropriate and proportionate to share information with other authorities. In particular, MROS may decide at the analysis stage not to provide information until it is clear whether or not it will be forwarded to the law enforcement agency. This avoids any anticipation of and, in particular, any circumvention of Art. 30, para. 5 AMLA.

C. Purpose limitation as a barrier to information exchange

31 MROS may provide information to the aforementioned authorities provided that they use the information exclusively to combat money laundering, its predicate offences, organized crime and terrorist financing. Consequently, MROS may only provide administrative assistance if the requesting authority states, or if it is clear from the authority's legally defined area of responsibility, that it will use the information for the aforementioned purposes. MROS provides the authorities with information in accordance with Article 29, para. 2 AMLA only on condition that the information is “used” in the aforementioned area of application. This restriction reflects the principle of purpose limitation or specialty.

32 Based on this, the intended use must be checked for each request for administrative assistance or for each spontaneous information. When exchanging information upon request, the reasoning of the requesting authority is particularly crucial. It is the responsibility of the requesting authority to explain the intended use of the information. Usually, it is necessary to assess whether the authority in question is active in AMLA-specific areas in the first step of the admissibility of the information exchange. In particular, the descriptions of the responsibilities in the legal bases of the respective authority or the penal provisions of the relevant norms can be used for the assessment. In accordance with the purpose of the exchange of information, namely to promote downstream proceedings, the principle of purpose limitation and the principle of speciality must be interpreted broadly within the given framework.

33 In summary, MROS must adhere to the principle of purpose limitation and the principle of speciality when exchanging information, but no absolute identity of purpose can be demanded within the framework of administrative assistance. This allows MROS a certain amount of discretion, which it should make use of. Administrative assistance is to be provided to those authorities that are active in the fight against money laundering, its predicate offenses, organized crime and terrorist financing and that also use the information for these purposes.

D. Restrictions under Article 30, paras. 2–5 AMLA

34 National administrative assistance can only take place in accordance with the reference in Art. 29 para. 2^bis AMLA if Art. 30, paras. 2–5 AMLA is complied with mutatis mutandis. This ensures that domestic authorities are treated equally with foreign authorities in terms of information exchange with MROS when compared to the information received by foreign authorities via the FIU channel.

35 Art. 30 para. 2 AMLA defines the information content and para. 3 the form of the information exchange. Art. 30 paras. 4 and 5 AMLA govern the conditions under which foreign FIUs may forward information received from MROS to third-party authorities. In the analogous application of this provision to national administrative assistance, this means that the restrictions that MROS must observe and ensure are those that apply both to the disclosure of information from foreign FIUs to national authorities (counterpart to Art. 29 para. 2^ter AMLA) and to the intended disclosure of information by the recipient to a national third-party authority (tripartite relationship).

1. Content of the exchange of information under Art. 30 para. 2 AMLA

36 In addition to financial information, the exchange of information may also include other personal data that is particularly worthy of protection. Accordingly, the Reporting Office may in particular receive information concerning the name of the financial intermediary or dealer (provided that the anonymity of the [natural] person involved is thereby preserved) who has filed a report or fulfilled a duty to provide information under the AMLA (lit. a); on the account holder, account numbers and account balances (lit. b); on the beneficial owner (lit. c); and on transactions (lit. d).

37 The wording of Art. 29, para. 2,subpara^. AMLA does not contain a reference to Art. 30, para. 1 AMLA, which establishes the availability principle. This means that data available directly or indirectly to MROS may be exchanged with foreign FIUs. In this case, the exchange of information also extends to data that MROS can obtain from public or private data controllers based on the legal provisions. Based on a request for administrative assistance from a foreign FIU, an in-depth analysis is carried out, which also includes, among other things, database queries in the police system.

38 In the absence of a corresponding reference, only the information that is immediately available at MROS is to be provided in the case of national administrative assistance. The information contained in the “goAML” information system is considered to be immediately available. Therefore, if an authority requests administrative assistance, only “goAML” is consulted. The information contained in this system comes in particular from suspicious activity reports, requests for administrative and mutual assistance (including international administrative assistance) or from communications from criminal authorities under Art. 29a AMLA. If the search does not produce any relevant hits in response to the specifically justified request for administrative assistance, a negative response is sent. However, no actual analysis, as in the case of cooperation with foreign reporting offices, is carried out.

39 Furthermore, a request for information under Article 11a AMLA based on information from a national request for administrative assistance is not permitted. Such a request is only possible if a SAR has already been received and the request is based on this report or if it is clear from the analysis of information from a foreign FIU that a financial intermediary under the Act is or has been involved in a transaction or business relationship related to this information.

2. Form in accordance with Art. 30 para. 3 AMLA

40 The analogous application of Art. 30 para. 3 AMLA to domestic administrative assistance determines the form of the information exchange. MROS provides information to the national authorities in accordance with Art. 29 para. 2^bis AMLA in “report form”, as is already the case with foreign reporting offices. This applies to both administrative assistance upon request and spontaneous information. The transmission of documents to the requesting authority is not permitted.

3. Requirements for the disclosure of information to third-party authorities in accordance with Art. 30 paras. 4 and 5 AMLA

41 The reference in Article 29 paragraph 2^bis AMLA to the application of Article 30 paragraphs 4 and 5 AMLA implies that the forwarding of information by domestic authorities to other administrative units (third-party authority) requires the prior express consent of MROS (para. 4). If criminal proceedings are already pending in the matter, MROS must also obtain the approval of the competent prosecuting authority before it can consent to the forwarding of the information (para. 5). It should be noted that the analogous application of Art. 30 para. 4 and para. 5 AMLA with regard to national administrative assistance primarily concerns those constellations in which the recipient of information from MROS intends to make this information available to a third-party authority. The main purpose of this consent to dissemination to a third-party authority is to ensure control over the forwarding (including compliance with the purpose limitation) (see Art. 30 para. 4 AMLA) and not to jeopardize any criminal investigations (see Art. 30 para. 5 AMLA).

42 If, on the other hand, MROS passes on information that is available to it and does not come from a foreign FIU, it does not have to obtain the prior consent of the domestic authority to disseminate the information. An exception to this is when the authority from which the information originates also imposes restrictions on use.

43 The application of Art. 30, para. 4 AMLA by analogy stipulates that MROS may only consent to the forwarding of information to a third authority if the latter uses the information exclusively (1.) for analysis purposes in the context of combating money laundering and its predicate offences, organized crime or terrorist financing, or (2.) for the initiation of criminal proceedings for money laundering and its predicate offenses, organized crime or terrorist financing, or to substantiate a request for mutual legal assistance in the context of such criminal proceedings (lit. a); it does not use the information as evidence (lit. c) and maintains official or professional secrecy (lit. d). Verification of dual criminality as defined in b) is not required for national administrative assistance, since the application of the law is limited to the same jurisdiction.

44 It should be noted that the transmission of information from a national authority to a third-party authority is subject to more restrictive conditions than the direct administrative assistance provided by MROS to an authority in accordance with Art. 29 para. 2^bis AMLA. This applies in particular to the use of information as evidence.

45 A further requirement of Art. 29 para. 2^bis in conjunction with Art. 30 para. 5 AMLA is the prior approval of the competent public prosecutor if the request for forwarding to a third-party authority concerns a matter that is the subject of criminal proceedings. If the database search shows that proceedings are pending, the competent public prosecutor must be contacted. If the public prosecutor in charge of the proceedings refuses to authorize the forwarding of information, the requirement for dissemination is not met, and the information must not be forwarded to the (third-party) authority. This procedure prevents any possible interference with the investigation.

46 In summary, MROS is authorized to provide administrative assistance to national authorities in accordance with Article 29, paragraph 2 AMLA, provided that the information is sent to an authority that is active in combating money laundering, its predicate offences, terrorist financing or organized crime and that the authority uses the information for these purposes (Article 29, paragraph 2^bis AMLA). If the recipient of the information intends to forward it to a third-party authority, MROS must give its consent to the dissemination in compliance with the relevant requirements (Art. 29 para. 2^bis AMLA in conjunction with Art. 30 para. 4 and 5 AMLA and Art. 29 para. 2^ter AMLA).

V. Information from foreign reporting offices in accordance with Art. 29 para. 2^ter AMLA

47 While MROS can forward information from national sources (e.g. information from suspicious activity reports) without the consent of the respective sources, information from foreign reporting offices is subject to more restrictive provisions. Art. 29 para. 2^ter AMLA stipulates that MROS may only forward information from foreign reporting offices to the supervisory authorities pursuant to Art. 29 para. 1 AMLA and to the authorities pursuant to Art. 29 para. 2 AMLA with the explicit consent of the reporting office.

48 Furthermore, the disclosure of information from foreign reporting offices is only permitted for the purposes stated in Art. 29 para. 2^bis AMLA. This addition is to be extended in line with international obligations, so that the entire restrictions of Art. 29 para. 2^bis AMLA are to be observed. This in turn refers to the application of Art. 30 para. 2–5 AMLA. Unlike national information that MROS obtains domestically, Art. 29 para. 2^ter AMLA is subject to the same restrictions as those applying to administrative assistance to other authorities under Art. 29 para. 2^bis AMLA. In the case of foreign information, it does not matter to which type of authority it is forwarded.

49 In addition, the foreign FIU's usage restrictions (disclaimer) must always be observed in these cases. The corresponding restrictions regarding the use of the information must also be passed on in national administrative assistance under Art. 29 AMLA.

VI. Information for the supervisory authorities under Art. 29 para. 3 AMLA

50 The basic idea of Art. 29, para. 3 AMLA is that the findings of MROS's analysis of judgments are fed back to the financial intermediaries via the supervisory authorities. This is to ensure that the financial intermediaries are made aware of the requirements of the prosecuting authorities. In this way, Art. 29 para. 3 AMLA serves as a link to Art. 29a paras. 1 and 2 AMLA, which ensure the feedback mechanism of the cantonal prosecuting authorities.

51 This legal construct of information transfer from the reporting office via the supervisory authorities to the financial sector proved to be inefficient; rather, in everyday practice, direct communication between the reporting office and the financial intermediaries regarding findings on combating money laundering, their predicate offences, organized crime and terrorist financing has become established. MROS regularly exchanges information with the financial sector and financial intermediaries, thereby also fulfilling its awareness-raising mandate (Art. 1 para. 1 let. c AMLA).

Bibliography

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Materials

Message on the Amendment of the Anti-Money Laundering Act of June 27, 2012, BBl 2012, available at https://www.fedlex.admin.ch/filestore/fedlex.data.admin.ch/eli/fga/2012/1031/de/pdf-a/fedlex-data-admin-ch-eli-fga-2012-1031-de-pdf-a.pdf, visited on July 1, 2024 (cited. Message AMLA 2013).

Message zur Änderung des Geldwäschereigesetzes vom 26.6.2019, BBl 2019, available at https://www.fedlex.admin.ch/filestore/fedlex.data.admin.ch/eli/fga/2019/1932/de/pdf-a/fedlex-data-admin-ch-eli-fga-2019-1932-de-pdf-a.pdf, visited on July 1, 2024 (cited as AMLA 2019 message).

Message zur Umsetzung der 2012 revidierten Empfehlungen der Groupe d'action financière (GAFI) of December 13, 2013, BBl 2013, available at https://www.fedlex.admin.ch/filestore/fedlex.data.admin. ch/eli/fga/2014/100/de/pdf-a/fedlex-data-admin-ch-eli-fga-2014-100-de-pdf-a.pdf, accessed on July 1, 2024 (cited as Message AMLA 2012).