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- Art. 3 FC
- Art. 5a FC
- Art. 6 FC
- Art. 10 FC
- Art. 16 FC
- Art. 17 FC
- Art. 20 FC
- Art. 22 FC
- Art. 29a FC
- Art. 30 FC
- Art. 32 FC
- Art. 42 FC
- Art. 43 FC
- Art. 43a FC
- Art. 55 FC
- Art. 56 FC
- Art. 60 FC
- Art. 68 FC
- Art. 75b FC
- Art. 77 FC
- Art. 96 para. 2 lit. a FC
- Art. 110 FC
- Art. 117a FC
- Art. 118 FC
- Art. 123b FC
- Art. 136 FC
- Art. 166 FC
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- Art. 11 CO
- Art. 12 CO
- Art. 50 CO
- Art. 51 CO
- Art. 84 CO
- Art. 143 CO
- Art. 144 CO
- Art. 145 CO
- Art. 146 CO
- Art. 147 CO
- Art. 148 CO
- Art. 149 CO
- Art. 150 CO
- Art. 701 CO
- Art. 715 CO
- Art. 715a CO
- Art. 734f CO
- Art. 785 CO
- Art. 786 CO
- Art. 787 CO
- Art. 788 CO
- Transitional provisions to the revision of the Stock Corporation Act of June 19, 2020
- Art. 808c CO
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- Art. 2 PRA
- Art. 3 PRA
- Art. 4 PRA
- Art. 6 PRA
- Art. 10 PRA
- Art. 10a PRA
- Art. 11 PRA
- Art. 12 PRA
- Art. 13 PRA
- Art. 14 PRA
- Art. 15 PRA
- Art. 16 PRA
- Art. 17 PRA
- Art. 19 PRA
- Art. 20 PRA
- Art. 21 PRA
- Art. 22 PRA
- Art. 23 PRA
- Art. 24 PRA
- Art. 25 PRA
- Art. 26 PRA
- Art. 27 PRA
- Art. 29 PRA
- Art. 30 PRA
- Art. 31 PRA
- Art. 32 PRA
- Art. 32a PRA
- Art. 33 PRA
- Art. 34 PRA
- Art. 35 PRA
- Art. 36 PRA
- Art. 37 PRA
- Art. 38 PRA
- Art. 39 PRA
- Art. 40 PRA
- Art. 41 PRA
- Art. 42 PRA
- Art. 43 PRA
- Art. 44 PRA
- Art. 45 PRA
- Art. 46 PRA
- Art. 47 PRA
- Art. 48 PRA
- Art. 49 PRA
- Art. 50 PRA
- Art. 51 PRA
- Art. 52 PRA
- Art. 53 PRA
- Art. 54 PRA
- Art. 55 PRA
- Art. 56 PRA
- Art. 57 PRA
- Art. 58 PRA
- Art. 59a PRA
- Art. 59b PRA
- Art. 59c PRA
- Art. 62 PRA
- Art. 63 PRA
- Art. 67 PRA
- Art. 67a PRA
- Art. 67b PRA
- Art. 73 PRA
- Art. 73a PRA
- Art. 75 PRA
- Art. 75a PRA
- Art. 76 PRA
- Art. 76a PRA
- Art. 90 PRA
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- Vorb. zu Art. 1 FADP
- Art. 1 FADP
- Art. 2 FADP
- Art. 3 FADP
- Art. 5 lit. f und g FADP
- Art. 6 Abs. 6 and 7 FADP
- Art. 7 FADP
- Art. 10 FADP
- Art. 11 FADP
- Art. 12 FADP
- Art. 14 FADP
- Art. 15 FADP
- Art. 19 FADP
- Art. 20 FADP
- Art. 22 FADP
- Art. 23 FADP
- Art. 25 FADP
- Art. 26 FADP
- Art. 27 FADP
- Art. 31 para. 2 lit. e FADP
- Art. 33 FADP
- Art. 34 FADP
- Art. 35 FADP
- Art. 38 FADP
- Art. 39 FADP
- Art. 40 FADP
- Art. 41 FADP
- Art. 42 FADP
- Art. 43 FADP
- Art. 44 FADP
- Art. 44a FADP
- Art. 45 FADP
- Art. 46 FADP
- Art. 47 FADP
- Art. 47a FADP
- Art. 48 FADP
- Art. 49 FADP
- Art. 50 FADP
- Art. 51 FADP
- Art. 54 FADP
- Art. 57 FADP
- Art. 58 FADP
- Art. 60 FADP
- Art. 61 FADP
- Art. 62 FADP
- Art. 63 FADP
- Art. 64 FADP
- Art. 65 FADP
- Art. 66 FADP
- Art. 67 FADP
- Art. 69 FADP
- Art. 72 FADP
- Art. 72a FADP
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- Art. 2 CCC (Convention on Cybercrime)
- Art. 3 CCC (Convention on Cybercrime)
- Art. 4 CCC (Convention on Cybercrime)
- Art. 5 CCC (Convention on Cybercrime)
- Art. 6 CCC (Convention on Cybercrime)
- Art. 7 CCC (Convention on Cybercrime)
- Art. 8 CCC (Convention on Cybercrime)
- Art. 9 CCC (Convention on Cybercrime)
- Art. 11 CCC (Convention on Cybercrime)
- Art. 12 CCC (Convention on Cybercrime)
- Art. 25 CCC (Convention on Cybercrime)
- Art. 29 CCC (Convention on Cybercrime)
- Art. 32 CCC (Convention on Cybercrime)
- Art. 33 CCC (Convention on Cybercrime)
- Art. 34 CCC (Convention on Cybercrime)
FEDERAL CONSTITUTION
MEDICAL DEVICES ORDINANCE
CODE OF OBLIGATIONS
FEDERAL LAW ON PRIVATE INTERNATIONAL LAW
LUGANO CONVENTION
CODE OF CRIMINAL PROCEDURE
CIVIL PROCEDURE CODE
FEDERAL ACT ON POLITICAL RIGHTS
CIVIL CODE
FEDERAL ACT ON CARTELS AND OTHER RESTRAINTS OF COMPETITION
FEDERAL ACT ON INTERNATIONAL MUTUAL ASSISTANCE IN CRIMINAL MATTERS
DEBT ENFORCEMENT AND BANKRUPTCY ACT
FEDERAL ACT ON DATA PROTECTION
SWISS CRIMINAL CODE
CYBERCRIME CONVENTION
COMMERCIAL REGISTER ORDINANCE
FEDERAL ACT ON COMBATING MONEY LAUNDERING AND TERRORIST FINANCING
- I. Preliminary remarks
- II. Art. 3 para. 1 AMLA – Identity of the contracting party
- III. Art. 3 para. 2 AMLA – cash transactions
- IV. Art. 3 para. 3 AMLA – Insurance premiums
- V. Art. 3 para. 4 AMLA – suspicion of money laundering
- VI. Art. 3 para. 5 AMLA – Authorities defining the threshold
- VII. Sanctioning of violations of the identification requirement
- Bibliography
- Materials
I. Preliminary remarks
1 The beginnings of customer due diligence date back to the very first agreement on the duty of care in the acceptance of funds and the handling of banking secrecy from July 1, 1977. In the years that followed, the Swiss Bankers Association increased the level of detail of the rules in connection with customer due diligence. In 1998, following various parliamentary initiatives and growing pressure from abroad, the duty to verify the identity of the contracting party was enshrined in law and extended to the non-banking sector. Since then, only marginal adjustments have been made to the legal text, which has been supplemented by various implementing provisions at the ordinance and sector-specific self-regulation level.
2 The identification of the contracting party is part of the catalog of duties defined in the AMLA that is intended to ensure due diligence in financial transactions. It is a central cornerstone in the fight against money laundering and terrorist financing. The particular purpose of identifying the contracting party is to reduce anonymity and increase transparency in financial transactions. Incriminated assets can be more clearly assigned to a person or persons, and the individual movements of assets can be better traced. In conjunction with the other due diligence requirements, the documentary basis is created that not only helps the authorities to locate and confiscate incriminated assets, but also to identify and potentially prosecute the persons responsible for money laundering. Financial intermediaries and traders are supported in identifying the contracting party with a better understanding of their customers (“Know Your Customer”). The granularity of the understanding of the customer has an impact on the economic component of a financial intermediary or trader. The more detailed the knowledge of a customer, the more profitably the range of services can be tailored to that customer.
3 The application and scope of the identification of the contracting party is based on the activity performed as a financial intermediary or dealer, the legal form of the contracting party, the type, duration and value of the assets of a business relationship in connection with financial transactions or the existence of special circumstances. For reasons of clarity and relevance of the following financial intermediaries for the Swiss financial center, this commentary focuses on the implementing provisions for banks (Art. 2 para. 2 let. a AMLA in conjunction with Art. 35 AMLO-FINMA and Art. 4–19 CDB 20), insurance institutions (Art. 2 para. 2 let. c AMLA in conjunction Art. 42 f. AMLO-FINMA and Art. 3–8 R SRO-SVV) and external asset managers (Art. 2 para. 2 let. abis AMLA in conjunction with Art. 44–55 AMLO-FINMA).
II. Art. 3 para. 1 AMLA – Identity of the contracting party
A. Entering into a business relationship
1. Business relationship
4 When entering into a business relationship, a financial intermediary is obliged under Art. 3 para. 1 AMLA to identify the contracting party on the basis of a probative document. AMLA does not provide a legal definition of the term “business relationship”. A business relationship within the meaning of Art. 3 para. 1 AMLA exists when a contractual relationship under private or administrative law exists between a financial intermediary and another party in connection with a financial transaction. The individual implementing provisions define what constitutes a relevant financial transaction with regard to the identification of the contracting party for financial intermediaries within the meaning of Art. 2, para. 2 AMLA that are subject to the licensing requirements under special legislation. Financial intermediaries without special licensing requirements are obliged to identify the contracting party if they carry out, in particular, any of the financial transactions listed in Art. 2 para. 3 let. a–g AMLA on a professional basis. The financial transactions that fall under Art. 2, para. 3, let. a–g AMLA or are explicitly excluded from it are set out in the implementing provisions. For certain financial transactions, the duty to verify the identity of the contracting party only arises when a threshold value is reached and/or exceeded.
5 The banking sector itself regulates the following financial transactions in particular: opening accounts, savings books or securities accounts; conducting fiduciary transactions; renting safe-deposit boxes; accepting instructions to manage assets held by third parties; executing trading transactions involving securities, foreign exchange, precious metals and other commodities as well as cash transactions involving amounts in excess of CHF 15,000. For decades, banks have also been obliged to verify the identity of their contractual partners in credit relationships. The list of financial transactions provided for in CDB 20 is therefore not exhaustive. It is supplemented by a ban on opening new bearer savings books.
6 Of the insurance institutions, those that offer or distribute units in collective investment schemes, operate direct life insurance or grant mortgage loans fall within the scope of the AMLA. In addition, a monetary threshold must be met for most of these financial transactions in order for the duty to identify the contracting party to take effect. Financial transactions that are not considered relevant to the AMLA include, in particular, pillar 2 and 3a insurance contracts, pure risk insurance (so-called insurance without a savings component), and the activities in connection with (mortgage) lending business that are explicitly excluded in Article 3 AMLO. Consequently, insurance institutions are not covered by the scope of the AMLA when operating a (tax-exempt) pillar 2 or 3a pension fund.
7 An external asset manager within the meaning of the AMLA is a person who, on a commercial basis, is able to dispose of assets on behalf of clients in the context of a financial transaction in accordance with Art. 3 let. c no. 1–4 of the FIDLEG. Financial transactions include all financial services to be provided for clients in connection with financial instruments in the areas of execution only, investment advice and asset management. In addition, any activity directed at specific customers that specifically aims at the purchase or sale of a financial instrument is to be regarded as a financial transaction; currency exchange transactions of CHF 5,000 or more; cash transactions of CHF 15,000 or more; transactions with virtual currency of CHF 1,000 or more, provided that these do not constitute money and value transfers and these transactions do not constitute a long-term business relationship within the meaning of Art. 2 let. d AMLO-FINMA; transfers of funds and assets from Switzerland abroad; transfers of funds and assets from abroad to Switzerland in excess of CHF 1,000.
2. Time
8 Pursuant to Art. 3 para. 1 AMLA, the financial intermediary must identify the contracting party when entering into the business relationship. A business relationship is deemed to have been entered into when the customer can use the contractually agreed services of the financial intermediary in connection with a relevant financial transaction. The contracting party must be identified before or at the latest upon the commencement of the business relationship. It is recommended that the contracting party be identified as part of the due diligence and thus before the business relationship is established, which is also how financial intermediaries usually do it. The main reasons for this are the ability to correct identification errors as part of the “multiple-eye” approval/control process and the associated avoidance of self-regulatory sanctions that could potentially be imposed in the event of a breach of due diligence.
9 According to Art. 4 para. 1 CDB 20, banks are obliged to verify the identity of the contracting party when entering into a business relationship. Art. 45 para. 1 CDB 20 clarifies that an account may only be used once the documentation required for the identification of the contracting party is complete and in the proper form. An account is deemed to be usable if it is technically possible to make bookings on the account. If only the account number is reserved internally within the bank or the account is blocked for inflows and/or outflows, the criterion of usability is not met. Potential customers (prospects) recorded in the system are only to be identified when the business relationship is established. In exceptional cases, an account may be used if only individual details and/or documents are missing or individual documents are not available in the proper form, sufficient information is available on the identity of the contracting party and the controlling person and/or beneficial owner and the application of this exception appears appropriate based on a risk-based assessment. The satisfaction of the cumulative conditions must be documented in a manner comprehensible to a knowledgeable third party. The missing information and/or documents must be obtained no later than 30 days after the business relationship is established. Art. 45 para. 3 in conjunction with para. 4 CDB 20 cannot be invoked if no identification documents are available at all or if the documents are inadequate, unclear or contradictory. One of the main cases in which the exception is applied in practice is when the bank has all the information and documents in full, but one of the identification documents is only available as a scan and not yet in the original.
10 Insurance institutions must have completed the identification of the contracting party completely and properly at the time of delivery of the policy, in the case of mortgage transactions before disbursement of the loan and in the area of collective investment schemes before the services are exchanged (i.e. acceptance of assets vs. posting of financial instruments to the client portfolio). There is no apparent obligation for insurance institutions to identify potential customers, especially since the duty of care can be carried out in all cases even after the contract has been concluded. The self-regulation of the insurance sector is silent on an analogous exception to the banking sector, namely the ability to provide missing information and/or documents after the business relationship has commenced, within a specified period of time.
11 External asset managers are obliged to carry out the identification of the contracting party when entering into a business relationship. Art. 55 para. 1 AMLO-FINMA specifies that all the documents and information required to identify the contracting party must be available in full before any transactions are carried out within the framework of a business relationship. As part of their self-regulation, a supervisory organization may impose stricter provisions than those of AMLO-FINMA and require its members to carry out the complete and proper identification of the contracting party at an earlier stage. The AMLO-FINMA and the self-regulation of the supervisory organizations do not provide for the possibility of subsequently documenting individual missing details and/or documents within a period of time after the execution of the first transaction or receipt of the power of disposition over the client assets.
3. Contracting party
12 A contracting party is any person deemed to be a legal entity under the locally applicable civil or public law that enters into a contractual relationship of a private or administrative nature with a financial intermediary in connection with a financial transaction. This includes all natural persons, legal entities or partnerships, public-law institutions, corporations, foundations and administrative units at the national, regional or municipal level in Switzerland or abroad. Public-sector entities are grouped together as “authorities” in CDB 20 and AMLO-FINMA, while self-regulation in the insurance sector (with the same interpretation content) refers to public-sector companies/corporations. The contracting party does not have to consist of only one legal entity, but can in principle be made up of several identifiable parties. If a financial intermediary's systems and/or the nature of the financial transaction do not provide for any restrictions, there is basically no limit to the number of parties that can make up a contracting party.
13 From Art. 3 para. 1 sentence 1 AMLA e contrario, it can be concluded that persons with whom the financial intermediary does not enter into a contractual relationship of a private or administrative nature in connection with a financial transaction do not have to be identified. However, if a legal entity or partnership is a contracting party, since 2009 all financial intermediaries have been legally obliged to take note of the power of attorney of a contracting party and to verify the identity of the person who enters into the business relationship on behalf of the contracting party (the so-called opener). In practice, a more in-depth implementation of Art. 3 para. 1 sentence 2 AMLA is observed in particular with regard to banks and external asset managers. For reasons relating to liability risks and the duty to verify the identity of the beneficial owner as provided for in Art. 4, para. 1, sentence 1 AMLA, a simple copy of the identification document is also obtained from authorized agents and beneficial owners or controlling owners and checked for plausibility as part of the due diligence of a business relationship.
14 If a legal entity has already been identified in an existing business relationship, the financial intermediary shall not carry out a new identification of the entity when the business relationship is extended. A legal entity shall be deemed to have already been identified if, when the business relationship was originally established, the identification was carried out in accordance with the implementing provisions in force at that time or, alternatively, with the currently applicable implementing provisions (so-called lex mitior). In practice, it has been observed that, for liability reasons, banks in particular only refrain from re-identifying a legal entity when expanding an existing business relationship if a qualitatively adequate copy of an identification document from the previous identification is available. Some financial intermediaries are even stricter and stipulate in their internal guidelines that they only accept copies of valid identification documents. When a business relationship is expanded, attention should be paid to the currency of the identification document in order to prevent the risk of violating one's own guidelines. The option of waiving re-identification is limited only to the legal entity that has already been identified and has no effect on other, previously unidentified legal entities within the framework of a multiparty agreement. The reasons for waiving a new identification are not to be documented on record. Rather, it is sufficient if it can be seen from the physical or electronic documentation that the legal entity has already been correctly identified.
4. General provisions
a. Evidentiary value
15 The financial intermediary must identify the contracting party in accordance with Art. 3, para. 1, first sentence AMLA on the basis of a conclusive document. In the 1996 Message, examples of conclusive documents for natural persons include official proof of identity such as a passport or ID card, and for legal entities, an extract from the commercial register or an equivalent document (certificate of incorporation). The question of when a document meets the requirements of conclusiveness is defined in the individual implementing provisions or according to civil or public law aspects.
b. Validity
16 Whether an identification document must be valid and how long it is considered valid is a key question for a financial intermediary when carrying out his due diligence. The regulations for the banking and insurance sectors and AMLO-FINMA do not explicitly stipulate a validity requirement for the identification document of a natural person. It is therefore left to the competence and discretion of the individual banks, insurance institutions and external asset managers to determine in their internal guidelines whether invalid identification documents are permitted when identifying natural persons, and if so, only in exceptional cases or not at all. If the identification document is no longer valid, it is assumed that there is no doubt about the identity of the natural person to whom it was issued and that there is no reason to believe that it no longer reflects the current circumstances (e.g. change of name due to marriage). If a financial intermediary decides to accept expired identification documents in general or in exceptional situations, he runs the risk that a knowledgeable third party (e.g. an audit firm or self-regulatory/supervisory organization) may assess the question of the admissibility of the identification document differently in individual cases. When choosing one of these approaches, it is recommended that at least the most important key points for dealing with invalid identification documents be defined in the internal guidelines. In particular, it would be necessary to determine under which conditions an expired identification document may be accepted, how the validity of the identification document is to be periodically verified and under which circumstances it is to be updated. If a financial intermediary decides to accept only valid identification documents, he is depriving himself of the flexibility to react to exceptional situations, increases his monitoring and updating efforts for the duration of the business relationship and runs a greater risk of violating his internal guidelines. It is therefore recommended that the processes and controls in connection with the validity of the identification documents be set out in the internal guidelines if this approach is chosen.
17 The document used to identify the contracting party, which is a legal entity or partnership, must not be older than twelve months and must reflect the current circumstances. An exception to this deadline is planned for banks, insurance institutions and external asset managers with regard to a specific type of association. An association that is not entered in the commercial register and is not subject to audit can only be identified by means of (usually older) statutes or other association documents. Depending on the date of establishment, such a contracting party would be unable to provide the financial intermediary with a conclusive identification document that was issued less than twelve months previously. It would therefore be impractical to adhere to the twelve-month period for an association that is not entered in the commercial register and is not subject to auditing requirements.
18 The date of issue of the identification document and the time at which the financial intermediary identifies the contracting party on the basis of the identification document presented to him and documents the performance of the identification for knowledgeable third parties are decisive for the calculation of the deadline. In doing so, the financial intermediary must carry out the identification of the contracting party with a view to establishing the business relationship in a timely manner and must not do so “in advance” with a view to meeting the deadline. It is therefore not unusual for a considerable period of time to elapse between the time of identification and the establishment of the business relationship.
c. Information to be documented
19 Financial intermediaries must record and retain the essential information obtained through the identification of the contracting party (see Art. 7, para. 1 AMLA). In the case of multiparty contracts, this must be done for each individual legal entity that makes up the contracting party.
20 In the case of natural persons, the financial intermediary must record and document the person's surname, first name, date of birth, domicile address and nationality. In accordance with Art. 23, para. 1 CC, domicile is the place where the natural person resides with the intention of remaining there permanently. Even though the dispatch and the individual implementing provisions speak of one nationality, it is advisable to clarify with the contracting party and document any further nationalities. This is due less to the duty of care in identifying the contracting party and more to the assessment of the risks of a business relationship in the areas of money laundering and terrorist financing, sanctions or taxes.
21 If the natural person comes from a country in which dates of birth or residential addresses are not used, this information is not to be recorded or kept. However, the background to such cases is to be recorded in writing (e.g. in the form of a memo).
22 In the case of legal entities or partnerships, the financial intermediary must record and retain the company name and registered address. When determining the registered address, the identification documents obtained (e.g. an extract from the commercial register) may be used as a primary source.
d. Internal documentation
23 In addition to recording and retaining the essential information from the identification of the contracting party, a financial intermediary must also record the means by which the identity was verified. Consequently, he is obliged to keep on his files a simple or certified copy of the document(s) on the basis of which the contracting party was identified. Internal files and thus the information and documents obtained, as well as clarifications carried out internally in connection with the identification of the contracting party, must be created, organized and stored in such a way that an expert third party can form a reliable opinion on compliance with due diligence within a reasonable period of time. In practice, it can be observed that banks and insurance institutions in particular store their documentation associated with the identification of the contracting party both physically and electronically in systems specifically designed for this purpose. In order to make them easier to find, they label the identification documents with specific titles/codes. External asset managers shall store the internal documentation associated with the due diligence commented on here mainly physically, i.e. in a separate section of the physical folder/file, and/or the files thereof at a separate location within the framework of a simple electronic folder structure.
5. Irregularities in identification
a. Substantive verification of the information and documents?
24 In the case of natural persons, the financial intermediary must examine the identification document and check the photograph to see whether the person appearing is the person indicated. If the contracting party is a legal entity or a partnership, a financial intermediary must check the identification documents in particular to see whether it exists and to see who represents it and to what extent. If no personal meeting takes place between the financial intermediary and the contracting party in the context of the identification, the confirmation of authenticity to be consulted by the financial intermediary shall confirm that the contracting party and the person on the identification document are one and the same.
25 A financial intermediary must also verify that the information documented corresponds to that on the identification document(s). With regard to the address of domicile and registered office, the financial intermediary may, in principle, rely on the information provided by the contracting party, since the address of domicile, in particular, is rarely reflected in an identification document. In line with a risk-based approach, the financial intermediary has further duties of clarification if there are indications (e.g. contrary information in the course of due diligence) that the information provided by the contracting party may not be correct (any longer). When opening an account by correspondence, banks and external asset managers must always verify the domicile address by postal delivery or other equivalent means. The implementing provisions for the insurance sector explicitly exclude this.
26 The implementing provisions require that, when a business relationship is established, the identification documents reflect the current circumstances of a legal entity or partnership. A financial intermediary should be able to rely on the information provided by the contracting party with regard to the up-to-dateness of the circumstances. If, in the course of the due diligence, there are indications that the identification documents do not reflect the current circumstances of the contracting party, the financial intermediary is obliged to obtain a more up-to-date version.
27 The financial intermediary must check the plausibility of the identification document with reasonable effort with respect to its authenticity. To do this, the financial intermediary must know the main characteristics of the identification documents of a country from which he wishes to accept contracting parties.
b. Missing identification documents
28 If a contracting party has no identification document within the meaning of the implementing provisions, a financial intermediary may, exceptionally, establish the identity on the basis of conclusive substitute documents. This approach applies in particular to natural persons without identification documents or public-law legal entities with no obligation to be entered in the commercial register and to have corresponding company documents. What is considered to be a substitute document of evidentiary value in such special cases depends on the legal nature of the contracting party, the legal circumstances and documentation standards of the country or countries concerned. The exceptional situation must be explained in writing and attached to the contracting party's complete documentation together with the substitute document of evidentiary value. The reasons for the absence of a corresponding identification document and the choice of alternative probative document should be clearly stated.
c. Doubts during identification
29 If a financial intermediary has doubts concerning the information provided on the identity of the contracting party when entering into or during the business relationship, he shall take appropriate measures, such as carrying out clarifications and/or repeating the identification. There is doubt if there are indications that the information on the identity of the contracting party is not or is no longer correct. It is recommended that measures be taken immediately if there are such indications. If the financial intermediary is able to dispel his doubts by taking the measures, the background and the result of the measures taken must be recorded in writing and attached to the overall documentation of the contracting party. If, despite the measures taken, the doubts cannot be removed (within the deadline) or if the financial intermediary suspects that the contracting party has knowingly provided false information regarding his identity or has provided forged documents, the identification shall be deemed to have failed.
30 In practice, doubts regarding the identity of the contracting party arise less frequently than regarding the beneficial owner, both at the outset and during the course of a business relationship. In particular, the heavy focus on formal aspects of Art. 3 AMLA in conjunction with the individual implementing provisions, the personal or written interaction between the contracting party or their representative(s) and the financial intermediary, the standardization and the fundamentally “official nature” of the documents to be obtained make it difficult for customers to consciously or unconsciously influence the identification process. In practice, doubts about the information originally provided by the contracting party regarding their identity only arise in the course of a business relationship. The most common reasons will be relocation, marriage in connection with a change of name, death or naturalization.
d. Failure of identification
31 An identification is deemed to have failed at the start of or during a business relationship if the requested information and/or documents from the contracting party as part of the identification process are not provided (in a timely manner), the financial intermediary's doubts about the information and/or documents regarding the identity of the contracting party are not dispelled in a timely manner despite measures taken, or there is a suspicion that the contracting party has deliberately provided false information and/or has provided forged documents. If the identification of a contracting party fails, the establishment of a new business relationship must be refused or the continuation of an existing business relationship must be discontinued in compliance with Art. 9 et seq. AMLA in conjunction with Art. 12a et seq. AMLO. If requested, the business relationship must be blocked for inflows and outflows. The AMLA and its implementing provisions do not define how quickly a business relationship is to be rejected or terminated in cases of failed identification without any suspicion of possible money laundering or terrorist financing. For the banking sector, this is to be done as quickly as possible without committing a breach of contract. Insurance institutions and external asset managers are also recommended to reject the new business relationship or terminate the existing one as quickly as possible in such cases. In addition, in the event of failed identifications, they should also document the background, the result of the measures taken and the fact of the rejection or termination itself, including the exact time, and attach this to the overall documentation of the (potential) contracting party. If identification fails, it must be assumed that all the business relationships in which the contracting party is involved have been “contaminated”. For this reason, in such cases all (potential) business relationships must be rejected and/or existing business relationships must be terminated that one intends to conduct or conducts with the contracting party.
B. Identifying natural persons
1. In the event of a personal meeting
32 During the personal meeting, physical contact takes place. In the process, a representative of the financial intermediary views and makes a copy of a probative document belonging to the contracting party and files it. The client file should show when and where this physical contact took place. The regulations do not specify where and for how long the meeting should take place. It does not necessarily have to be on the business premises of the financial intermediary. If a copy of the probative document is only made after the personal meeting, the provisions on identification when establishing a business relationship by correspondence apply.
33 An evidentiary document is an official document with a photograph, such as a passport, an ID card or a driver's license. The CDB does not provide an exhaustive list. In line with the risk-based approach, it is up to the financial intermediary to decide which documents are acceptable. On the other hand, for insurance companies, Art. 4 R SRO-SVV definitively regulates the permissible probative documents for natural persons. For external asset managers, Art. 45 Para. 3 AMLO-FINMA stipulates that those identification documents are permissible that are provided with a photograph and have been issued by a Swiss or foreign authority.
34 The copy of the document does not necessarily have to be photocopied, but can also be scanned or photographed. In addition to the identification data and the signature, the photograph of the contracting party must also be recognizable on the copy. Reasons for which it is technically impossible to make a recognizable copy of the photograph remain reserved.
2. By correspondence
35 When entering into a business relationship by correspondence, the financial intermediary must verify the domicile address of the contracting party by postal delivery or by another equivalent means and file a certified copy of the probative document.
36 The term “by correspondence” is too narrowly defined, as it includes not only the opening of the business relationship by letter, but also by telephone, via the internet or by other electronic means, such as online identification in accordance with FINMA Circular 2016/7. The case in which a third party who is not authorized to represent and is not is not considered to be a contracting party, personally delivers the account-opening documents signed by the contracting party to the financial intermediary, as in such cases there is no personal meeting with the contracting party. It would therefore be more precise to use the wording of Art. 45 para. 2 AMLO-FINMA: “Establishment of the business relationship ‘without personal meeting’”.
37 The financial intermediary must verify the domicile address by postal delivery or another equivalent method. According to CDB 20, delivery by ordinary mail (A or B mail) is sufficient. In particular, the provision of an official confirmation of domicile is deemed to be equivalent. The provision of so-called utility bills (electricity, water or telephone bills) and tax or other official bills is also common.
38 In the case of insurance companies, the domicile address does not have to be verified. In addition, Art. 4 Para. 1 lit. c R SRO-SVV allows a further procedure for this sector: “Instead of identification in accordance with lit. a [in person] and b [by correspondence], it is sufficient in both cases to deliver the insurance policy or the confirmation of the opening of the premium account by a domestic or foreign post office by registered letter with return receipt or by courier service with receipt, provided that delivery is made personally to the person to be identified and that the person is identified on the basis of an official identification document in accordance with lit. a. The insurance company must keep the return receipt/receipt and a simple copy of the identification document on file.”
39 From a practical point of view, the following should also be noted. According to Art. 13 para. 2 lit. c AMLO-FINMA, the absence of personal contact with the contracting party is also a possible criterion for a business relationship with increased risks (GmeR). Establishing a business relationship by correspondence may thus have an impact on the risk calculation of the business relationship. The internal risk score will be increased if this is taken into account or may even lead to the business relationship being classified as a higher-risk business relationship. Furthermore, it should be noted that actively avoiding personal contact is a clue to money laundering in accordance with no. 3.4.1 of the AMLO-FINMA appendix.
3. Issuers of confirmations of authenticity
40 When the business relationship is established without a personal meeting, the financial intermediary receives a copy of the required probative document instead of the original. It is therefore necessary to confirm the authenticity of the copy.
41 The confirmation of the authenticity of the copy of the probative document may be issued by a notary or a public office which usually issues such confirmations of authenticity; a financial intermediary in accordance with Art. 2, para. 2 or 3 AMLA with domicile or registered office in Switzerland; an attorney licensed in Switzerland; a financial intermediary domiciled or based abroad that carries out an activity in accordance with Art. 2 para. 2 or 3 AMLA, provided that it is subject to equivalent supervision and regulation with regard to combating money laundering and terrorist financing.
42 What is meant by “equivalent supervision and regulation” in relation to combating money laundering and terrorist financing? The Anti-Money Laundering Control Authority (AMLCA), one of the three predecessor authorities of FINMA, had already stated in its practice regarding Article 2 para. 3 AMLA that equivalence cannot be verified in the abstract. It therefore left the clarifications to the individual financial intermediaries and did not maintain a list of the supervisory authorities recognized as equivalent. FINMA also does not publish such a list. The CDB also states that “equivalent” or “appropriate” must be assessed on a case-by-case basis. Possible criteria include the FATF country list or the assessments of Transparency International and other non-governmental organizations (NGOs). However, the assessment in each individual case remains decisive. In this process, it must be ensured that, on the one hand, the equivalent “supervision” and, on the other hand, the equivalent “regulation” or “supervision” must be assessed.
43 Regarding the term attorney-at-law, the CDB 20 Commentary and the R SRO-SVV Commentary state that public bodies within the meaning of Art. 11 para. 1 let. c CDB 20 and Art. 4 para. 2 let. b R SRO-SVV can also include attorneys-at-law licensed abroad. However, they must be authorized for this function by the foreign law. In practice, there is often uncertainty when the issuer of the certificate of authenticity does not identify themselves with the most common term “lawyer” or “attorney-at-law”, but rather as “advocate”, “solicitor”, “lawyer”, “solicitor”, “lawyer” or “barrister”. With regard to the correct interpretation of the term “lawyer”, it is not the terminology used that is decisive, but the possession of a lawyer's patent. On the basis of this additional qualification, licensed lawyers enjoy greater credibility than simple lawyers.
44 In order to take account of the growing use of digital technology, an alternative to the authentication of copies of the documents required as evidence is provided for. The financial intermediary may also obtain a copy of an identity document from the database of a recognized certification service provider in accordance with the Federal Act on Electronic Signatures (ZertES). The contracting party is authenticated electronically. The technical procedure of the electronic signature can be used to verify the authenticity of a document, an electronic message and the identity of the signatory.
4. Special forms
a. Minors
45 When a business relationship in the name of a minor is opened by a third party, the opening adult person must be identified. However, if the (sane) minor opens a business relationship in person, it is the minor (and not his legal representative) who must be identified.
b. Sole proprietorship
46 When entering into a business relationship with the owner of a sole proprietorship, the financial intermediary shall comply with the requirements for natural persons. Banks and insurance companies may also proceed in accordance with the rules applicable to legal entities and partnerships for sole proprietorships registered in the commercial register.
c. Communities of heirs
47 If the financial intermediary's contracting party dies, the community of heirs shall succeed to the business relationship by universal succession, and shall become the new contracting party. In civil law, communities of heirs are to be qualified as simple partnerships. Therefore, when a new business relationship is established, the provisions of Art. 46 para. 1 AMLO-FINMA, Art. 16 para. 1 CDB 20 or Art. 4 para. 5 R SRO-SVV apply. If the deceased person has already been properly identified in the context of an existing business relationship, re-identification can be waived.
d. Joint accounts
48 Unless an exception applies, all account holders must be identified for joint accounts (including so-called joint accounts). This has been repeatedly confirmed by the CDB supervisory board. It must also apply by analogy to external asset managers. If a life insurance contract is concluded by several policyholders, all policyholders must also be identified.
e. Collective accounts
49 As long as the ownership rights are held in a collective account or collective deposit account in the name of the company, only the company must be identified for collective accounts or collective deposit accounts used to manage employee ownership plans.
f. Usufruct
50 If both the capital owner and the usufructuary each establish a business relationship with the financial intermediary, both must be individually identified. The same applies if the capital owner and the usufructuary can only dispose of the property jointly. By a contrario, only the legal entity that can dispose of the property would have to be identified if it is not both of them but they establish a business relationship together.
g. Condominium and co-ownership associations
51 According to the CDB, both condominium and co-ownership associations must be identified by an entry in the land register based on an excerpt from the land register. If the excerpt from the protocol shows that the manager is authorized to manage the account, identification can also be based on the excerpt from the protocol together with a simple copy of the regulations.
h. Tenant deposit account
52 A tenant deposit account is opened by the landlord in the tenant's name for the purpose of depositing a rent deposit. The tenant does not have sole power of disposal over the assets deposited; he requires the landlord's consent.
53 This special form is in fact only relevant for banks. According to the CDB, the contracting party of a tenant deposit account for a rental property in Switzerland does not need to be identified. E contrario, for rental properties abroad, a corresponding identification must be carried out in accordance with the rules of Art. 4 CDB 20.
i. Life insurance contracts
54 In the case of insurance contracts, the person requesting the contract must be identified. If a life insurance contract is concluded by several policyholders, all policyholders must be identified as contracting parties. The representative, the insured person or the beneficiary is not considered to be a contracting party or a policyholder.
C. Identification of legal entities and partnerships
1. When registering
55 When the contracting party is a legal entity or a partnership, no distinction is made between the establishment of a business relationship with and without a personal meeting. Whether the persons who opened the account were personally present is only relevant to the way in which the identity of the persons who opened the account is verified.
56 Legal entities or partnerships registered in the Swiss commercial register or in an equivalent foreign register are to be identified by means of a register extract issued by the registrar, a written extract from a database maintained by the registry authority or a written extract from privately managed directories and databases (provided these are trustworthy).
57 For insurance companies, the R SRO-SVV Commentary lists the sources that are deemed equivalent to an extract from the commercial register: Publications in the Swiss Official Gazette of Commerce (SOGC), in the central business name index of the federal government (ZEFIX), a current Teledata/Creditreform/Bisnode D&B-Print, publications and confirmations of the supervisory authorities (e.g. listing of the contracting party on the FINMA website) or confirmations of the auditors (audit certificate).
58 The requirements regarding the quality of identification documents are not the same for external asset managers, insurance companies and banks. Pursuant to Art. 48 para. 1 AMLO-FINMA, the relevant documentation must be submitted to the financial intermediary in the original or as a certified copy. Pursuant to Art. 5 R SRO-SVV, insurance companies are obliged to identify the contracting party on the basis of conclusive original documents. For banks, however, a simple copy of the identification document of legal entities and partnerships is sufficient. These statements also apply to contracting parties without an entry in the register, in accordance with the following chapter.
59 Regarding the current validity of the respective identification documents, we refer to our comments in Chapter II.A.4.b. (see above, N. 16 et seq.).
2. Without entry in the register
60 Legal entities and partnerships not entered in the Swiss commercial register or an equivalent foreign register must be identified on the basis of the articles of association, the formation documents or the formation agreement, a confirmation from the auditors, an official authorization to carry out the activity or an equivalent document; or a written extract from privately administered directories and databases (provided these are trustworthy) .
61 The financial intermediary must identify the public authority as a contracting party on the basis of a suitable statute or decision or on the basis of other equivalent documents or sources.
62 Regarding the current validity of the relevant identification documents, we refer to our comments in Chapter II.A.4.b. (see above, N. 16 ff.).
3. Identity of persons establishing the business relationship
63 If the contracting party is a legal entity or partnership, the identity of the persons who establish the business relationship on behalf of the legal entity must be verified.
64 The persons authorized to represent and actually acting at the time of opening the business relationship and signing the opening documents are deemed to be the persons opening the account. The focus here is on the natural persons who sign the documentation underlying the contractual relationship. The other persons authorized to sign for a contracting party are not to be identified, even if they are authorized to represent the contracting party vis-à-vis a financial intermediary in the context of the business relationship.
65 Compared with opening relationships with natural persons, the verification of the identity of the persons opening the account involves a simplified form of identification. According to the R SRO-SVV, the persons opening the account may themselves make a copy of the identification document and send it by post or electronically. According to the CDB, the actual residential address of the persons opening the account does not have to be noted or verified. Furthermore, the essential information from the identification of the persons opening the account in accordance with Art. 7, para. 1 CDB 20 does not have to be recorded and documented separately. In practice, however, financial intermediaries often do record this information anyway, particularly because the persons opening the account usually also act as authorized agents within the framework of the business relationship. If the persons establishing the business relationship should at a later date become a contracting party, they must be identified in accordance with the rules for natural persons, provided this has not already been done.
4. Power of attorney
66 If the contracting party is a legal entity, the power of attorney provisions of the legal entity are to be noted only for the record. This means that when the business relationship is established, the bank must inspect a list of the persons with a power of attorney or power of representation. Such a list must be copied and kept on file. The type of signing authority must also be documented, i.e. whether it is an individual or collective signing authority.
67 Art. 15 para. 3 CDB 20 only mentions “legal entities” and omits “partnerships”, which are explicitly mentioned in para. 1. This is intentional. Para. 3 does not apply to differently organized contracting parties such as simple partnerships, general partnerships, limited partnerships or trusts.
68 Art. 44, para. 3 AMLO-FINMA and Art. 5, para. 3 R SRO-SVV refer to the “legal entity” or “partnership” as the contracting party. The requirements for external asset managers and insurance companies are therefore deliberately more extensive.
69 Persons who are authorized to act on behalf of the financial intermediary are considered to be authorized representatives. In addition to the persons opening the account, the identity of the other authorized representatives listed in the corresponding proof of representation does not have to be verified.
70 Typically, the provisions of the power of attorney are taken from an extract from the commercial register or an equivalent register. Alternatively, powers of attorney granted by corporate bodies to other persons, extracts from corresponding internal regulations, signature books, certificates of incumbency and similar documents may also be accepted, provided that they provide sufficient information about the power of attorney. This also applies to the provision of a simple copy of the relevant corporate documents (such as statutes, association regulations, minutes of the general assembly and board of directors).
71 In the case of a “chain of representation”, all the links in the chain must be checked and documented, in particular in the case of a substitute power of attorney or if the legal entity itself is the authorized representative.
5. Special forms
a. Simple partnership
72 Simple partnerships have no legal personality, are not capable of acting, litigating or enforcing, and are not entered in the Commercial Register.
73 When a insurance company identifies a simple partnership, it must always identify the partners who sign the contract.
74 When entering into a business relationship with a simple partnership, banks and external asset managers may choose to identify all the partners or at least one partner, as well as the persons authorized to sign for the financial intermediary.
75 For so-called “exclusively charitable companies”, i.e. simple partnerships whose purpose is to safeguard the interests of their members or their beneficiaries in joint self-help or which exclusively pursue political, religious, scientific, artistic, charitable, social or similar purposes, such as Jass clubs, Guggenmusik and class funds, the CDB provides for a relaxation for banks. Only the persons authorized to sign for the bank must be identified. The charitable status and its exclusivity must be documented in a manner comprehensible to third parties, whether by means of an excerpt from the internal regulations, a meaningful website, a tax exemption certificate or similar plausible evidence.
b. Widely known company and authority
76 The financial intermediary may refrain from identification in the case of a widely known legal entity or partnership or an authority and instead record the fact that the identity of the contracting party is widely known.
77 Widely known companies are in particular public limited companies or companies directly or indirectly associated with such.
78 Swiss public-law entities are only deemed to be public authorities if they have a legal basis and carry out public duties. These include, in particular, federal, cantonal and municipal authorities, together with their institutions and public-law corporations. The foreign concept of authority is determined by the respective foreign law.
79 The reasons for waiving identification must be documented by the financial intermediary in the file in a manner comprehensible to an independent third party. There are no further formal requirements in this regard. In practice, a memorandum is drawn up and the stock exchange listing of the public company or the proof concerning the legal basis of the authority is printed out or saved.
c. Trust
80 The Swiss legal system does not have a specific substantive law of trusts. The trust has no legal personality of its own but is, according to the Swiss interpretation of the law, a contract between the trustee and the beneficiaries.
81 In the case of business relationships with a trust, the financial intermediary must identify the trustee as the contracting party, either according to the requirements for natural persons or for legal entities or partnerships. In addition, the trustee must confirm in writing that he is authorized to open a business relationship for the trust. In the case of banks, this is typically done by means of Form T. As an alternative to this written confirmation, a so-called “legal opinion” is also permissible. There are no precise formal requirements here. This is usually provided by a lawyer and contains at least the same information as Form T.
82 In practice, the business relationship is not only opened by trustees but also by so-called “underlying companies”. This is a domiciliary company held by a trust, the shares of which are in the trust assets. In these cases, the domiciliary companies are the contracting parties of the financial intermediary.
d. Company in formation
83 When a company, in particular an AG or GmbH, is being formed, a confirmation of the deposited share capital must be available for entry in the commercial register. In practice, the corresponding capital is deposited in a capital contribution or payment account at a bank. The account must be in the name of the company being formed and must initially be blocked. The capital may only be made available once the governing bodies have been appointed and evidence of this provided.
84 The bank must identify the persons opening an account for companies that are being formed.
85 After the company has been established it must be identified in accordance with the provisions for legal entities and partnerships (Art. 12 ff. VSB 20) if it becomes a contracting party of the financial intermediary. In practice, as a rule no new account is opened; instead the existing account is renamed, e.g. by deleting the suffix “in Gründung”.
D. Delegation
1. General provisions
86 A financial intermediary may delegate the identification of the contracting party to third parties. This approach is of interest to the financial intermediary in practice in particular where the third party involved (e.g. external asset manager or broker) knows the prospective client better and therefore has more familiar access to him or has greater expertise in a geographical region. The natural person or legal entity or partnership entrusted by the financial intermediary with the identification of the contracting party, domiciled or established in Switzerland or abroad, may not, as a general rule, call upon any other third parties. After the identification has been carried out by the mandated person, the financial intermediary must keep a copy of the identification documents for his records and must obtain written confirmation that the copies provided to him correspond to the originals. With regard to the identification documents received, the financial intermediary carries out a subsequent check to ensure that the third party has duly fulfilled the duties of due diligence. He checks the plausibility of the results of any additional clarifications, for example if there are doubts about the information provided regarding the identity of the contracting party. Regardless of the type of delegation, a financial intermediary remains responsible under supervisory law in all cases for the proper performance of the tasks for which he has involved the third party.
2. Types of delegation
a. Delegation with written agreement
87 A financial intermediary may, by means of a written agreement, mandate a third party to carry out the identification of the contracting party, provided that he carefully selects the mandated person, instructs the latter on his duties regarding the due identification and monitors the third party's compliance with the duties of due diligence during the contractual relationship. The implementing provisions do not define the criteria for careful selection. In practice, the following are checked in particular before a person is commissioned: their integrity (e.g. background check in a screening system purchased from an external provider and/or obtaining an extract from the criminal records), specialist knowledge (e.g. obtaining training certificates and/or CVs) and the possible fulfillment of specific supervisory requirements (e.g. entry in a register). In the written agreement, the financial intermediary and the mandated third party shall set out the rights and obligations underlying the delegation of identification.
b. Delegation without written agreement
88 The financial intermediary shall not be required to conclude a written agreement when delegating the identification of the contracting party provided the person appointed is an office within a group or a group and applies an equivalent standard of due diligence. Delegation to other financial intermediaries is also covered by this exception, provided that they are subject to equivalent regulation and supervision in relation to combating money laundering and terrorist financing and have taken measures to perform the due diligence in an equivalent manner. The client file should make it clear to an expert third party why the identification of the contracting party was carried out by an authorized person without a written agreement.
E. FINMA-RS 2016/7
1. General
89 The rules issued by FINMA should be as technology-neutral as possible to ensure fair competition between all financial market players and to avoid competitive disadvantages.
90 In order to take digital regulation into account in the fight against money laundering and terrorist financing, particularly with regard to the identification of the contracting party and the establishment of the beneficial owner when entering into a business relationship, FINMA Circular 2016/7 “Video and online identification” came into force on March 18, 2016. The objective is to interpret the duties of due diligence under AMLA and the corresponding implementing provisions, namely AMLO-FINMA, the CDB and the SRO-SIA regulations, with regard to a digital environment, with a focus on establishing business relationships via electronic channels.
91 FINMA-Circ. 2016/7 is directly applied to financial intermediaries in accordance with Art. 2 para. 2 AMLA. Where the circular makes reference to AMLO-FINMA, this also includes the analogous provisions of the CDB and the SRO-SIA regulations. FINMA Circular 2016/7 applies indirectly to financial intermediaries in accordance with Art. 2 para. 3 AMLA by reference to this circular in the corresponding SRO or AO regulations.
92 In order to avoid competitive disadvantages for Swiss financial intermediaries, enabling digital account opening is certainly to be welcomed in view of a competitive international environment. On the other hand, a purely digital process of video and online identification increases the risk of using falsified or counterfeit identification documents, for example. In addition, a specific infrastructure and corresponding expertise is required, which can be associated with high costs, as this is usually purchased externally.
93 In practical terms, video and online identification is a key aspect of financial services solutions that are fully digitized and are mostly offered by so-called smartphone or neobanks. Retail banks usually have video and online identification as a supplement to their range of services. For private banks, these electronic channels tend to be the exception, since the focus is on the exchange between the client advisor and the client.
2. Video identification
94 Video identification refers to the identification of the contracting party by means of video transmission. Such identification is equivalent to identification in the case of a personal interview, provided that the conditions set out in margin no. 6 et seq. of FINMA Circular 2016/7 are met, regardless of whether the contracting party is a natural person, a legal entity or a partnership, or whether there are several contracting parties.
95 Video transmission refers to audiovisual communication in real time (i.e. a live connection). The financial intermediary must use suitable technical aids for this purpose. These must, on the one hand, provide secure transmission and suitable image and audio quality. On the other hand, they must ensure that information in the machine-readable zone (MRZ) on the identification document can be read and decrypted.
96 From an organizational point of view, the financial intermediary must establish a process for conducting the identification meeting and draw up a discussion guide. The employees entrusted with the video identification must be trained accordingly. The meeting with the contracting party must be audio-recorded in its entirety. The recordings must be checked for quality on a random basis and stored internally in such a way that an expert third party can form a reliable judgment within a reasonable period of time.
97 The video identification of natural persons is governed by margin nos. 5–22 of FINMA-Circ. 2016/7. In order to verify the authenticity of the identification document, the financial intermediary must, on the one hand, electronically read and decode the information in the MRZ. On the other hand, a visually variable security feature and another randomly selected security feature must be examined. This can also be done by means of a visual check, such as tilting the ID. It follows from this that, unlike identification in the case of a personal (physical) meeting, in the case of video identification only official identification documents can be provided that have both an MRZ and optical security features.
98 If there is any doubt regarding the authenticity of the identification document or the identity of the contracting party, or if the image and/or audio quality does not allow for proper identification, the video identification process will be aborted. In this case, the conventional identification process by means of a personal interview or by correspondence remains possible.
99 The video identification of legal entities and partnerships is governed by margin nos. 23–26 of FINMA-RS 2016/7, in addition to margin nos. 5–22 of FINMA-RS 2016/7, which also apply. As with conventional identification, video identification also requires an extract from a database maintained by the relevant registry authority or from a trustworthy, privately managed directory, but in electronic form. The contracting party's authorization provisions must also be acknowledged in electronic form. The identity of the persons opening the account must be verified in accordance with the requirements in margin no. 5-22 FINMA-RS 2016/7.
100 Video identification must be carried out for each contracting party individually and in accordance with the respective rules (margin nos. 5–22 FINMA-RS 2016/7 for natural persons; margin nos. 5–26 FINMA-RS 2016/7 for legal entities and partnerships), provided that a business relationship is entered into with several contracting parties.
3. Online identification
101 Online identification involves obtaining identification documents by digital correspondence and the conditions under which the identification documents obtained digitally may be treated the same as those obtained by conventional means.
102 A photocopy of the identification document produced by the contracting party is treated the same as a simple copy of the identification document. In order for the financial intermediary to be able to keep the photograph in its files, the contracting party sends it electronically. The main application of such an uncertified photograph of the identification document is in the simplified due diligence requirements pursuant to Article 12, para. 2 AMLO-FINMA.
103 For equivalence with the authenticated ID copy, FINMA Circular 2016/7 provides for three possible procedures. In all three, only official identification documents that have an MRZ and optical security features may be accepted.
104 The first procedure according to margin no. 32 et seq. of FINMA-Circ. 2016/7 concerns the electronic copy of the identification document with authentication by the financial intermediary. In this case, the financial intermediary must obtain photographs of all the relevant sides of the identification document and of the contracting party itself. These photographs must be compared with each other accordingly. Furthermore, the digitally decoded information must be checked for consistency with the remaining information on the ID card and with the data provided by the contracting party when the business relationship was established. The authenticity of the identification document must be assessed on the basis of at least two randomly selected security features. The financial intermediary shall also have the contracting party transfer money from an account held in the contracting party's name. The financial intermediary may dispense with this under the conditions set out in margin no. 33.1 of FINMA Circular 2016/7. Finally, the financial intermediary must also verify the contracting party's residential address as part of the initial procedure. The financial intermediary can do this on the basis of a tax or other official invoice, an energy, water or telephone bill (utility bill), a postal delivery, a public register, a database or directory maintained by a trustworthy private individual, or geolocalization.
105 The second procedure according to margin no. 38 f. of FINMA-Circ. 2016/7 concerns the electronic copy of an identification document with a qualified electronic signature. In this case, the financial intermediary must obtain an electronic copy of all the relevant pages of the identification document via an electronic channel. This image of the identification document provided by the contracting party must be provided with a qualified electronic signature in accordance with the ZertES issued by a certification service provider recognized in Switzerland. The information on the ID must be checked by the financial intermediary for consistency with that of the qualified electronic signature.
106 The third procedure according to margin no. 40 f. FINMA-Circ. 2016/7 concerns the digital certificate of authenticity. This may be created by the issuer of certificates of authenticity in accordance with Art. 49 AMLO-FINMA and sent to the financial intermediary by electronic means. If the issuer of the confirmation of authenticity carries out the confirmation of authenticity at the address provided by the contracting party in the account opening process as their residential address, the confirmation of authenticity issued in this way simultaneously provides the confirmation of residence in accordance with Art. 45 para. 2 AMLO-FINMA. The fact that the confirmation of authenticity is carried out at this address must be evident from the documentation.
107 For legal entities and partnerships, the photographs of the person establishing the business relationship must be verified in accordance with the requirements in margin no. 32 of FINMA Circular 2016/7. In addition, margin no. 43 of FINMA Circular 2016/7 states that the financial intermediary must have the contracting party transfer money from an account held in the contracting party's name. Finally, an extract in accordance with margin no. 24 of FINMA Circular 2016/7 and the contracting party's power of attorney must be obtained.
4. Involvement of third parties
108 Taking into account Articles 28 and 29 AMLO-FINMA, the financial intermediary may mandate third parties to carry out the video and online identification. The circular emphasizes that these third parties or companies must in particular have the technical knowledge and technical means with regard to the identity documents of the countries concerned. They must provide the financial intermediary with the photographs, electronic copies, audio recordings, declarations and documentation they have created (including by electronic means) for it to keep on its files. In any case, the financial intermediary itself remains responsible under supervisory law for the proper performance of the tasks of the third parties involved.
109 According to Art. 28 para. 3 AMLO-FINMA, third parties called in may not in turn call in any further persons or companies. With only this wording, the frequent constellation in which a financial intermediary commissions another financial intermediary to identify the contracting party would only be possible in the analog environment. Since this would not be in line with the spirit of technology neutrality, the following explanation of Art. 28 para. 3 AMLO-FINMA was added to the table on technology neutrality under margin no. 53 of FINMA-Circ. 2016/7 as of June 1, 2021: “If a financial intermediary involves another financial intermediary and the latter carries out the video and online identification through directly commissioned service providers, the latter are not considered to be additional persons or companies and there is no prohibited sub-delegation.”
III. Art. 3 para. 2 AMLA – cash transactions
115 A distinction must be made between (long-term) business relationships within the meaning of Art. 3 para. 1 AMLA and one-off financial transactions, known as cash transactions. Pursuant to Art. 3, para. 2 AMLA, financial intermediaries are only required to verify the identity of the contracting party in the case of a cash transaction if it reaches a significant threshold and the contracting party has not already been identified. The contracting party is generally the legal entity that carries out the cash transaction with the financial intermediary.
A. Definitions
1. AMLO-FINMA / CDB 20
116 Pursuant to Art. 2 let. b AMLO-FINMA, a cash transaction is deemed to be any cash transaction, in particular currency exchange, the purchase and sale of precious metals, the sale of traveler's checks, the cash payment of bearer instruments, cash and bond bonds and the cash redemption of checks, provided that no lasting business relationship is associated with these transactions. The determining factor in individual cases is not the cash settlement in the sense of a physical receipt or delivery of an asset. Rather, the execution of the one-off financial transaction must not be carried out via an existing account and must not result in any further relationship between the contracting party and the financial intermediary.
2. AMLO-SFBC
117 The implementing provisions for the licensed casinos sector distinguish between land-based and online games. In connection with both types of games, occasional financial transactions may arise that require the licensed casino to identify the player and thus its contracting party when a significant threshold is reached. The following are considered relevant one-off financial transactions in the case of land-based games: the purchase and sale of tokens to the casino; the payment of winnings from automated gambling machines; the issuing and cashing of checks; the exchange of currency and banknotes; and in the case of online games, the deposit of funds into a player's own account in accordance with Art. 50 para. 1 VGS and the transfer of winnings and credit balances to a player's own payment account in accordance with Art. 50 para. 2 DDO.
3. AMLO-FDJP
118 According to Art. 2 let. b AMLO-FDJP, a cash transaction in the large-scale gambling sector includes all cash transactions with players, in particular the payment of gambling winnings in cash, as well as the payment of gambling winnings by bank or postal transfer, provided that no long-term business relationship is associated with these transactions. The AMLO-FDJP differentiates between cash transactions for online and non-online major games. For non-online major games, an organizer must identify the player if a payout of winnings reaches one of the specified significant thresholds. In the case of major games played online, the identification requirement applies if a player makes deposits into their own player account or transfers a significant amount from the player account to their own payment account. According to Art. 2 let. c AMLO-FDJP, a lasting business relationship exists if the organizer of the major game provides the player with an account for game credits. In the case of major games conducted online, the organizer basically provides the player with an account for game credits. Participation in a major game conducted online basically requires an account for game credits provided by the organizer. As a rule, a player account for game credits requires registration and identification of the player. Consequently, the financial transactions required under Art. 4, para. 1 AMLO-FDJP for the identification of the contracting party do not qualify as spot transactions in the strict sense.
4. AMLO-BAZG
119 In the banking precious metals trade, the spot transaction is the purchase and sale of precious metals in cash, provided that no long-term business relationship is associated with these transactions. A lasting business relationship within the meaning of the Ordinance exists if a customer relationship exists between the contracting party and a Swiss trade assay office or a Swiss group company in accordance with Art. 42bis EMKG, which is not limited to a one-time activity subject to the Ordinance.
B. Significant threshold
120 The substantial threshold values provided for in Art. 3 para. 5 AMLA in conjunction with the implementing provisions (see below, Chapter VI, N. 134 ff.) can be reached or exceeded by one or more related transactions. The conclusion of several spot transactions just below the substantial threshold (so-called smurfing) is regarded as an indication of money laundering.
C. Lack of prior identification
121 A contracting party is considered to be not already identified in a cash transaction if he does not have a (long-term) business relationship with the financial intermediary or has not already been properly identified in the case of certain previous cash transactions. Even if no new identification is to be carried out, the financial intermediary shall check the existing identification documentation to ensure that it is in order and to ensure that the contracting party is the person who has already been identified. In any case, however, the beneficial owners must be identified.
IV. Art. 3 para. 3 AMLA – Insurance premiums
122 Art. 3 para. 3 AMLA requires insurance institutions to verify the identity of their contracting party only if, as with cash transactions within the meaning of Art. 3 para. 2 AMLA, a significant threshold is reached or exceeded. When calculating the significant threshold, any premium deductions/surcharges must be taken into account. The basis for this calculation is either the amount of the one-time premium or, in the case of periodic premiums, the total premium volume, including taxes, that is owed according to the policy.
123 If the insurance institution suspects that the identification requirement is to be circumvented by concluding several insurance contracts or premium accounts with premium payments below the minimum limit (so-called smurfing), it must nevertheless identify the contracting party. Such suspicion exists if, taking into account all the circumstances, there are no identifiable legitimate reasons for taking out several life insurance policies or premium accounts.
124 Insurance institutions are also not required to re-identify a contracting party that has already been identified in an existing business relationship when the scope of the business relationship is expanded.
V. Art. 3 para. 4 AMLA – suspicion of money laundering
125 Article 3 para. 4 AMLA states that, in the cases mentioned in paras. 2 and 3, if there are suspicious circumstances regarding possible money laundering or terrorist financing, the contracting party must be identified even if the relevant thresholds are not reached. The risk of money laundering or terrorist financing also exists for financial transactions below the respective thresholds.
126 For external asset managers, this rule is explicitly implemented in Art. 51 para. 3 AMLO-FINMA, for banks in Art. 6 para. 2 CDB 20, and for insurance companies in Art. 3 para. 2 R SRO-SIA. AMLO-SFBC and AMLO-FDJP do not contain any explicit implementation provisions, but Art. 3 para. 4 AMLA must also be applied by casinos and organizers of major games. AMLO-BAZG explicitly states that the contracting party must be identified in any case if there are suspicions of possible money laundering or terrorist financing.
127 If there are grounds for suspecting money laundering or terrorist financing, the second sentence of Article 52 para. 2 AMLO-FINMA also requires the recipient of a transfer of funds and assets (from abroad to Switzerland) to be identified in every case.
128 Suspicious facts within the meaning of Article 3 para. 4 AMLA are understood to mean concrete indications of money laundering. These do not have to reach the level of seriousness of “well-founded suspicion” within the meaning of Article 9 para. 1quater AMLA. The materials on the right to report under Art. 305ter para. 2 SCC and the duty to report under Art. 9 para. 1 AMLA should therefore be consulted.
129 For the right to report, subordination or vague impressions are not sufficient. Indicative evidence that points to incriminated assets may be reported as “perceptions”. Even one piece of evidence is enough to trigger a report; certainty is not required. In its most recent case law, the Federal Supreme Court stated the following regarding the reporting requirement: “If, in the context of background clarifications pursuant to Art. 6 para. 2 AMLA [...] the suspicion cannot be dispelled, it is automatically deemed to be well-founded.” In its judgment of January 11, 2021, the Federal Supreme Court also referred to the 1996 dispatch on the AMLA. It was already stipulated there that suspicions that cannot be dispelled must be reported, which is in line with the logic of the AMLA and the purpose of this law.
130 Art. 3, para. 4 AMLA must be considered in this context. If there is a concrete indication of money laundering, the contracting party must be identified in any case. Based on the existing suspicion, the financial intermediary must carry out appropriate background checks in accordance with Art. 6, para. 2 AMLA. Only if the suspicion that the assets are of criminal origin cannot be refuted, must the business relationship be reported to the Money Laundering Reporting Office. The mere existence of a suspicious fact does not directly lead to a report under Art. 9 para. 1 AMLA. The initial identification of the contracting party is intended to ensure that such a report could be made in the first place.
131 The Annex to AMLO-FINMA lists possible indications of money laundering. The list is not exhaustive and contains the following specific indications for cash transactions in nos. 3.1.1 to 3.1.8: Exchanging a large amount of banknotes (foreign and domestic) with a small nominal value for those with a large nominal value; exchanging a significant amount of money without posting it to a customer account; cashing large amounts of checks, including traveler's checks; buying or selling large quantities of precious metals on an over-the-counter basis; buying a significant amount of bank checks on an over-the-counter basis customers; transfer orders to foreign countries by walk-in customers without any apparent legitimate reason; repeated conclusion of spot transactions just below the identification limit; acquisition of bearer securities by physical delivery.
132 According to the commentary R SRO-SVV, indications of unusual activity and thus possible suspicions of money laundering may also arise during the term of the contract. This is the case, for example, if the contracting party wishes to pay in an amount of more than CHF 15,000 in cash; the economic environment or the knowledge and experience of the customer cannot be or can no longer be reconciled with the contract; the construction of the contract indicates that a criminal purpose is to be achieved; the purpose of the contract conclusion is not recognizable or appears to be economically nonsensical; the contracting party, in addition to the insurance policy; a business relationship is entered into with asset holding entities for which no specific person is the beneficial owner, or in the case of business relationships with partnerships, trusts and domiciliary companies; or the conclusion otherwise appears unusual, unless it is recognizable as being lawful.
133 There are numerous indications of money laundering. The ones we know of today should not be considered exhaustive. On the contrary, new ones will constantly be added, for example, with regard to the ongoing digitalization of the business with virtual assets. According to Wyss, any suspicion of possible money laundering or terrorist financing must be taken into account. This is to be agreed. In case of doubt, the financial intermediary must decide in favor of the identification of the contracting party.
VI. Art. 3 para. 5 AMLA – Authorities defining the threshold
134 By introducing thresholds, the legislator is pursuing the aim of keeping the clarification and documentation effort of the financial intermediaries for certain types of financial transactions within reasonable limits. This emanation of the principle of proportionality is based on the assumption that the risk of money laundering is considered to be low for small sums. In accordance with Art. 3 para. 5 AMLA, the FINMA, the SROs, the SFGB, the Federal Office of Justice and Police and the FOC are responsible for determining the threshold values and their relevance in connection with Art. 3 para. 2 (cash transactions) and para. 3 AMLA (insurance premiums).
A. FINMA
135 Within the scope of its authority, FINMA has set the following significant thresholds: CHF 15,000 or more for cash transactions; CHF 5,000 or more for currency exchange transactions; CHF 1,000 or more for occasional financial transactions with virtual currencies; CHF 1,000 or more for transfers of funds and assets from abroad into Switzerland; and CHF 0 if funds or assets are transferred from Switzerland out of the country. The ordinance does not provide for a period of time for calculating several interrelated transactions for the purpose of reaching the stated thresholds.
B. SBA
136 The SBA is not mentioned in Art. 3 para. 5 AMLA and is not considered a self-regulatory organization within the meaning of Art. 24 et seq. AMLA. However, based on Art. 7 para. 3 FINMASA, FINMA recognizes the self-regulation of the banking sector as a minimum standard. According to Art. 4 para. 2 lit. g CDB 20, banks must identify the contracting party in the case of cash transactions involving amounts in excess of CHF 15,000. CDB 20 does not define a period for calculating several interrelated transactions for the purpose of reaching the threshold value.
C. SRO - Example SRO-SIA
137 The SRO-SVV is a recognized self-regulatory organization within the meaning of Art. 24 et seq. AMLA. In Art. 3 para. 1 R SRO-SVV, it therefore states that, for the predominant financial transactions, a premium payment(s) of more than CHF 15,000 triggers the identification of the contracting party. For the calculation of premiums for conventional life insurance policies with savings components and unit-linked life insurance policies, a period of five years applies to reach the stated threshold per contract.
D. ESBK
138 With regard to the identification of the contracting party, the ESBK provides for a substantial threshold of CHF 4,000 or more for various isolated financial transactions, which a player must reach within 24 hours. In the case of land-based games, the licensed casinos are free to identify and register all players, regardless of a threshold. The reasons for such a procedure in practice are in particular the relief of the transaction monitoring (e.g. elimination of the verification of thresholds or of “smurfing” to circumvent possible identification measures) as well as the implementation of social protection measures (e.g. gambling addiction or avoidance of the participation of minors).
E. FDJP
139 For non-online major games, the level of the substantial thresholds is generally based on the method of participation in the major game. The FDJP therefore defines the significant thresholds for cash transactions for non-online major games as follows: prize payments of CHF 5,000 or more for electronic tickets, CHF 10,000 or more for printed tickets, and CHF 15,000/25,000 or more for all other non-online major games. The same thresholds apply to large-scale online games over a thirty-day calculation period, even though the financial transactions that identify the contracting party do not usually constitute cash transactions in the strict sense. The amount of the significant thresholds for major games played online varies depending on the type of transaction (incoming vs. outgoing payments from the player account), the percentage of stakes in a period of 30 days in major games with a certain payout ratio or the circumstance of whether the winnings are game winnings or not.
F. BAZG
140 The BAZG set the thresholds as follows within the scope of its competence: CHF 15,000 or more for cash transactions; CHF 5,000 or more for foreign exchange transactions; CHF 1,000 or more for virtual currency transactions, provided that these are not asset transfers and are not associated with a lasting business relationship; CHF 1,000 or more for asset transfers from abroad to Switzerland; and CHF 0 if asset transfers are made from Switzerland abroad. The ordinance does not provide for a period of time for calculating several related transactions for the purpose of reaching the significant thresholds mentioned.
VII. Sanctioning of violations of the identification requirement
A. FINMASA, AMLA, AMLO-FINMA
141 The supervisory authorities under special legislation fulfil their tasks by imposing sanctions and also pursue their supervisory and strategic objectives. Combating money laundering is one of FINMA's strategic objectives.
142 If there are indications of irregularities or violations of the law, FINMA first conducts informal preliminary clarifications. Such indications may arise from FINMA's supervisory activities (e.g. its own on-site inspections or audit reports by audit firms). Reports from third-party authorities, complaints from clients or media reports may also trigger preliminary clarifications. In addition, supervised institutions and audit firms must immediately report to FINMA any incidents that are of material significance for supervision. In connection with the duty of identification under Article 3 AMLA, it should also be noted that the CDB Supervisory Board and the respective AOs and SROs report violations and decisions to FINMA.
143 If there are indications of violations of supervisory law, FINMA will open enforcement proceedings. These are conducted in accordance with the APA, which regulates both the first-instance proceedings before FINMA and the appeal proceedings before the Federal Administrative Court. Enforcement contributes to the achievement of supervisory and strategic objectives and aims to eliminate abuses, restore compliance with the law and sanction violations in a way that also acts as a deterrent. It is used in a targeted manner for serious violations of supervisory law.
144 A serious violation of supervisory law with regard to Article 3 AMLA is determined according to the criteria for the opening of enforcement proceedings and FINMA Circular 2013/3. The assessment of the severity of the violation of Article 3 AMLA can be divided into the case groups “systematic errors” and “individual cases”. A systematic violation of Art. 3 AMLA constitutes a serious violation of a regulatory provision. This may include, for example, the circumstance that video identifications carried out over a period of months are no longer traceable or no longer available due to poor data quality or other IT problems. In contrast, a one-time, isolated and minor violation of financial market obligations is generally not sufficient to open enforcement proceedings. However, a one-time violation of a central obligation, such as the duty to provide information in accordance with Art. 29 FINMASA, can result in enforcement proceedings. The duty to identify in accordance with Art. 3 AMLA also represents such a central due diligence obligation. For example, failure to carry out identification in the case of a cash transaction despite obvious suspicions of possible money laundering or terrorist financing. Or consciously ignoring doubts about the identity of the contracting party and not clarifying them further. In individual cases, the intensity of the breach of duty and the significance of the disregarded duties are taken into account. Ultimately, FINMA uses its discretion to decide whether a serious violation has occurred. This allows it to define this vague legal term.
145 Art. 30 et seq. FINMASA lists the following supervisory instruments that FINMA can use to address violations of the obligations under the AMLA: restoration of a proper state of affairs in accordance with Art. 31 FINMASA; determination of serious violations of supervisory law by means of a ruling and substitute performance in accordance with Art. 32 FINMASA; professional ban of up to five years in accordance with Art. 33 FINMASA; temporary or permanent ban on activities in accordance with Art. 33a FINMASA; publication of the legally binding final ruling, stating personal data in accordance with Art. 34 FINMASA; confiscation of unlawfully obtained gains or avoided losses in accordance with Art. 35 FINMASA; appointment of an independent and expert investigating agent in accordance with Art. 36 FINMASA; and withdrawal of the license, recognition, admission or registration in accordance with Art. 37 FINMASA. Any violation of the law is sufficient only for the “restoration of the proper state of affairs”; otherwise, all of the above-mentioned supervisory instruments require a serious violation of supervisory provisions.
146 The only violations of the AMLA that are penalized are the violation of the reporting requirement in accordance with Art. 9 in conjunction with Art. 37 AMLA and the violation of the duty of inspection by dealers in accordance with Art. 15 in conjunction with Art. 38 AMLA. Violations of the other due diligence and conduct requirements under Article 3 et seq. AMLA are not penalized.
147 Under Article 9 para. 1 AMLO-FINMA, a violation of the provisions of the AMLO-FINMA may call into question the guarantee of proper business conduct required of the financial intermediary. For financial intermediaries subject to prudential supervision by FINMA, this possibility of sanction already arises from the general licensing requirements; see Art. 3 para. 2 let. c BankG for banks and Art. 14 para. 1 VAG for insurance companies. Serious violations can, according to Art. 9 para. 2 AMLO-FINMA, result in a ban from the profession under Art. 33 FINMASA and the confiscation of the profits gained from the violations under Art. 35 FINMASA. Regarding the ban from the profession, it should be noted that the “person responsible for the violation” can be banned from “an activity in a leading position”. The person concerned is not therefore required to have held a management position at the time of their misconduct.
B. CDB
148 If banks domiciled in Switzerland sign up to the CDB, they are subject not only to the supervisory sanctions system under Art. 30 et seq. FINMASA, they are also subject to the monetary sanctions system set out in Art. 58 ff. CDB 20. This is a civil law system.
149 If breaches of contract are suspected, the CDB investigating agent conducts the necessary investigations and submits a proposal to the CDB supervisory board for the instigation of sanctions proceedings or for the full or partial dismissal of the proceedings. In straightforward cases, the bank can request an abbreviated procedure by means of a self-report. To do this, it must submit the complete files and a report from the audit firm, in which case the investigation procedure is omitted and only the sanction procedure is carried out.
150 The CDB Supervisory Commission is responsible for investigating and punishing violations of the code of conduct. It determines the appropriate penalty in the sanctioning procedure or dismisses the procedure in whole or in part.
151 The CDB sanctioning provisions distinguish between minor cases and non-minor cases of violations of the code of conduct. A case is generally deemed to be a minor case if the CDB's anti-money laundering purpose has been achieved despite formal deficiencies. Art. 63 CDB 20 lists some non-exhaustive examples. If the case is a minor one, the proceedings against the bank at fault are to be closed without sanction.
152 A systemic failure on the part of the bank does not constitute a trivial case. A breach of the code of conduct may also be a matter of a merely different interpretation of the relevant CDB provision(s). In the event of a breach of the code of conduct, the bank at fault may be subject to a contractual penalty of up to ten million francs. The following must be taken into account when calculating the penalty: the severity of the violation of the CDB provision(s), the degree of fault, the financial situation of the bank and the measures imposed by other instances in the same case. Art. 68 CDB 20 provides for arbitration in the event of non-payment of the imposed penalty. The decisions of the court of arbitration may be appealed under Art. 389 et seq. CPC.
153 The CDB Supervisory Board informs FINMA of its decisions. The audit firm must also report to FINMA any violations of the CDB rules of professional conduct that are not to be classified as minor cases (as well as to the CDB Supervisory Board). The facts reported to FINMA may include not only violations of the provisions of the CDB but also violations of other supervisory and criminal law provisions.
C. SRO – example SRO-SIA
154 The SRO-SIA has the task of ensuring that the affiliated insurance companies comply with the statutory and regulatory due diligence requirements. To this end, it issues a special KPS SRO-SVV based on Art. 10 of its own statutes and in consultation with FINMA, in which it defines the necessary internal and external control procedures, the system of sanctions and the legal remedies. The obligation to issue corresponding regulations arises from Art. 25 AMLA.
155 In the event of a breach of the duties under the AMLA and/or the SRO-SIA regulations, the SRO-SIA board is obliged to take the necessary measures to restore compliance with the law. The offending insurance company is given a legal hearing before such a decision is made.
156 In addition, the SRO-SIA board may decide on sanctions. It may issue a written warning or impose a fine of up to one million francs. Such fines are collected and may be donated in whole or in part to charitable organizations. SRO-SIA sanctions are private in nature and may be challenged in arbitration. The legal remedies set out in Art. 389 et seq. of the Swiss Code of Civil Procedure (CPC) apply to the decisions of the arbitral tribunal.
D. External asset managers and trustees
158 With the FinIA, which came into force on January 1, 2020, external asset managers and trustees must be licensed by FINMA and join a supervisory organization (SO) approved by FINMA. They are considered prudentially supervised financial intermediaries in accordance with Art. 2 para. 2 lit. abis AMLA. With the prudential supervision, the AO also assumes the monitoring tasks in accordance with AMLA.
159 Violations of laws, ordinances and regulations by the affiliated are primarily clarified and investigated by the AO. The AO can order appropriate measures, such as setting deadlines for the restoration of compliance with the law and regulations, sending a request for a supervisory meeting, imposing conditions of a personnel or organizational nature, setting deadlines for regular reporting on certain events or facts. A report is made to FINMA if the measures ordered by the AO are disregarded by the affiliates (deadlines pass unused, the supervisory meeting is refused, etc.). Serious violations are reported immediately to FINMA.
160 However, the sanctioning authority remains with FINMA. If the AO discovers violations of supervisory law in the course of its ongoing supervision, FINMA imposes sanctions in accordance with the supervisory instruments available to it pursuant to Art. 30 et seq. FINMASA. An appeal against a FINMA ruling may be lodged with the Federal Administrative Court in accordance with APA.
The comments presented here only reflect the interpretations and views of the authors. No conclusions can be drawn regarding the practices of the authors' employers.
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Materials
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Aufsichtskommission VSB, Praxis der Aufsichtskommission zur Sorgfaltspflicht der Banken, 1.1.–30.6.2021, abrufbar unter https://www.swissbanking.ch/de/themen/regulierung-compliance/geldwaeschereibekaempfung, besucht am 4.9.2024.
Aufsichtskommission VSB, Praxis der Aufsichtskommission zur Sorgfaltspflicht der Banken, 1.7.–31.12.2022, abrufbar unter https://www.swissbanking.ch/de/themen/regulierung-compliance/geldwaeschereibekaempfung, besucht am 4.9.2024.
Aufsichtskommission VSB, Praxis der Aufsichtskommission zur Sorgfaltspflicht der Banken, 1.1.–30.6.2023, abrufbar unter https://www.swissbanking.ch/de/themen/regulierung-compliance/geldwaeschereibekaempfung, besucht am 4.9.2024.
Aufsichtsorganisation AOOS - Schweizerische Aktiengesellschaft für Aufsicht, Reglement der Aufsichtsorganisation nach Finanzinstituts- und Finanzmarktaufsichtsgesetz vom 1.1.2023, abrufbar unter www.aoos.ch/dataset/file/7653-20230306-aoos-ao-reglement-pdf, besucht am 4.9.2024.
Botschaft zum Bundesgesetz zur Bekämpfung der Geldwäscherei im Finanzsektor vom 17.6.1996, BBI 1996 III S. 1101 ff., abrufbar unter https://www.fedlex.admin.ch/eli/fga/1996/3_1101_1057_993/de, besucht am 4.9.2024.
Botschaft zur Umsetzung der revidierten Empfehlungen der Group d’action financière (GAFI) vom 15.6.2007, BBI 2007 S. 6269 ff., abrufbar unter https://www.fedlex.admin.ch/eli/fga/2007/938/de, besucht am 4.9.2024.
Botschaft über die Änderung des Schweizerischen Strafgesetzbuches und des Militärstrafgesetzes (Revision des Einziehungsrechts, Strafbarkeit der kriminellen Organisation, Melderecht des Financiers) vom 30.6.1993, BBl 1993 III 277 ff., abrufbar unter www.fedlex.admin.ch/eli/fga/1993/3_277_269_193/de, besucht am 4.9.2024.
Botschaft zum Finanzdienstleistungsgesetz (FIDLEG) und zum Finanzinstitutsgesetz (FINIG) vom 4.11.2015, BBl 2015 8901 ff., abrufbar unter www.fedlex.admin.ch/eli/fga/2015/2141/de, besucht am 4.9.2024.
Casino Zürichsee AG, Allgemeine Geschäftsbedingungen für die Nutzung des Spielangebots auf der Spielplattform, abrufbar unter: https://online.swisscasinos.ch/agb, besucht am 4.9.2024.
EJPD, Erläuterungsbericht des Eidgenössischen Justiz- und Polizeidepartements zu den Verordnungen zum Geldspielgesetz (VGS, SPBVEJPD, GwV-EJPD) vom 22.10.2018, abrufbar unter www.esbk.admin.ch/esbk/de/home/rechtsgrundlagen/gesetzgebung.html, besucht am 4.9.2024.
ESBK, Tätigkeitsbericht 2022 vom 6.2023, abrufbar unter: https://www.esbk.admin.ch/esbk/de/home/publiservice/publikationen.html, besucht am 4.9.2024.
FATF, Anti-money laundering and counter-terrorist financing measures - Switzerland, Fourth Round Mutual Evaluation Report, 2016, Paris, abrufbar unter https://www.fatf-gafi.org/content/dam/fatf-gafi/images/mer/mer-switzerland-2016.pdf.coredownload.inline.pdf, besucht am 4.9.2024.
FINMA, Erläuterungsbericht zur Zusammenführung der Geldwäschereiverordnungen der FINMA vom 8.6.2010, abrufbar unter https://www.finma.ch/de/dokumentation/archiv/abgeschlossene-anhoerungen/2010/, besucht am 4.9.2024.
FINMA, Erläuterungsbericht zur Totalrevision der GwV-FINMA vom 11.2.2015, abrufbar unter https://www.finma.ch/de/dokumentation/archiv/abgeschlossene-anhoerungen/2015/, besucht am 4.9.2024.
FINMA, Erläuterungsbericht zur Teilrevision der GwV-FINMA vom 8.3.2022, abrufbar unter https://www.finma.ch/de/dokumentation/archiv/abgeschlossene-anhoerungen/2022/, besucht am 4.9.2024.
FINMA, Erläuterungsbericht zum Rundschreiben 2016/7 «Video- und Online-Identifizierung» vom 21.12.2015, abrufbar unter www.finma.ch/de/dokumentation/archiv/abgeschlossene-anhoerungen/2016/, besucht am 4.9.2024.
FINMA, Erläuterungsbericht zum Rundschreiben 2016/7 «Video- und Online-Identifizierung» vom 13.2.2018, abrufbar unter www.finma.ch/de/dokumentation/archiv/abgeschlossene-anhoerungen/2018/, besucht am 4.9.2024.
FINMA, Erläuterungsbericht zum Rundschreiben 2016/7 «Video- und Online-Identifizierung» vom 16.11.2020, abrufbar unter www.finma.ch/de/dokumentation/archiv/abgeschlossene-anhoerungen/2020/, besucht am 4.9.2024.
FINMA, Jahresbericht 2017, abrufbar unter https://www.finma.ch/~/media/finma/dokumente/dokumentencenter/myfinma/finma-publikationen/geschaeftsbericht/20180327-jahresbericht-2017.pdf, besucht am 4.9.2024.
FINMA, Leitlinien zum Enforcement vom 25.9.2014, abrufbar unter www.finma.ch/de/finma/taetigkeiten/leitlinien/, besucht am 4.9.2024.
FINMA, Liste der aktuell anerkannten Selbstregulierungen, abrufbar unter: https://www.finma.ch/de/dokumentation/selbstregulierung/anerkannte-selbstregulierung/, besucht am 4.9.2024.
FINMA, Liste der aktuell bewilligten Selbstregulierungsorganisationen, abrufbar unter: https://www.finma.ch/de/bewilligung/selbstregulierungsorganisationen-sro/, besucht am 4.9.2024.
FINMA, Strategische Ziele 2021 bis 2024, abrufbar unter www.finma.ch/de/finma/ziele/strategische-ziele/, besucht am 4.9.2024.
Grand Casino Kursaal Bern AG, Allgemeine Geschäftsbedingungen, abrufbar unter: https://www.grandcasino-bern.ch/de/uebersicht-komponenten/startseite/agb, besucht am 4.9.2024.
Kontrollstelle für die Bekämpfung der Geldwäscherei, Praxis zu Art. 2 Abs. 3 GwG vom 29. Oktober 2008, abrufbar unter: www.finma.ch/FinmaArchiv/gwg/d/dokumentationen/publikationen/gwg_auslegung/pdf/59402.pdf, besucht am 4.9.2024.
Motion 86.956 vom 10.10.1986, Leuenberger Moritz, Bankengesetz. Priorität für Teilrevision, abrufbar unter: https://entscheidsuche.ch/docs/CH_VB/CH_VB_001_86-956_1987-03-20.pdf, besucht am 4.9.2024.
Rundschreiben 2011/1, Tätigkeit als Finanzintermediär nach GwG, Ausführungen zur Geldwäschereiverordnung (GwV), siehe online unter: https://www.finma.ch/de/~/media/finma/dokumente/dokumentencenter/myfinma/rundschreiben/finma-rs-2011-01-01-01-2017.pdf?sc_lang=de&hash=C13E76F1B7CE20DFB9B822526B383187, besucht am 4.9.2024.
Rundschreiben 2013/3, Prüfwesen, siehe online unter: www.finma.ch/de/~/media/finma/dokumente/dokumentencenter/myfinma/rundschreiben/finma-rs-2013-03-20221207.pdf, besucht am 4.9.2024.
Rundschreiben 2016/7, Video- und Online-Identifizierung, Sorgfaltspflichten bei der Aufnahme von Geschäftsbeziehungen über digitale Kanäle, siehe online unter: www.finma.ch/de/~/media/finma/dokumente/dokumentencenter/myfinma/rundschreiben/finma-rs-2016-07-20210506.pdf, besucht am 4.9.2024.
Schweizerische Bankiervereinigung, Kommentar zur Vereinbarung über die Standesregeln zur Sorgfaltspflicht der Banken (VSB 20) vom 13.6.2018, abrufbar unter https://www.swissbanking.ch/de/downloads, besucht am 4.9.2024.
Schweizerischer Versicherungsverband, Kommentar zum Reglement der Selbstregulierungsorganisation zur Bekämpfung der Geldwäscherei und der Terrorismusfinanzierung vom 12.2019, abrufbar unter https://www.sro-svv.ch/de/regelwerk/kommentar-zum-reglement-sro-svv, besucht am 18.12.2024.
Schweizerischer Versicherungsverband, Kontroll-, Prüf und Sanktionsreglement der SRO-SVV vom 1.1.2017, abrufbar unter https://www.sro-svv.ch/images/pdf/de_regelwerk/KPS_SRO-SVV.pdf, besucht am 4.9.2024.
Schweizerischer Versicherungsverband, Statuten SRO-SVV vom 21.8.2020, abrufbar unter https://www.sro-svv.ch/images/pdf/de_regelwerk/Statuten_SRO-SVV.pdf, besucht am 4.9.2024.
Swisslos Interkantonale Landeslotterie, Bedingungen für die Online-Teilnahme vom 13.1.2025, abrufbar unter: https://www.swisslos.ch/media/de/swisslos/teilnahmebedingungen/bedingungen-f%C3%BCr-die-online-teilnahme.pdf, besucht am 4.9.2024.
Tanner André/von Rotz Madeleine, Kommentierung zu Art. 305ter StGB, in: Lehmkuhl Marianne Johanna/Wenk Jan (Hrsg.), Onlinekommentar zum Schweizerischen Strafgesetzbuch – Version: 13.08.2024: https://onlinekommentar.ch/de/kommentare/stgb305ter, besucht am 4.9.2024, DOI: 10.17176/20240813-190118-0.
Zentralamt für Edelmetallkontrolle, Richtlinie R-249, Weisungen zur Geldwäschereiverordnung-BAZG inkl. Prüfanweisungen vom 1.5.2024, abrufbar unter: www.bazg.admin.ch/bazg/de/home/dokumentation/richtlinien/r-249_weisungen_geldwaeschereiverordnung-bazg.html, besucht am 4.9.2024.