Asset recovery: a Swiss leap forward?
| Pages | 150-158 |
| DOI | https://doi.org/10.1108/JMLC-06-2016-0024 |
| Published date | 02 May 2017 |
| Date | 02 May 2017 |
| Author | George Pavlidis |
| Subject Matter | Accounting & Finance,Financial risk/company failure,Financial compliance/regulation,Financial crime |
Asset recovery: a Swiss
leap forward?
George Pavlidis
Department of Law, Neapolis University, Papos, Cyprus
Abstract
Purpose –International asset recovery proceedings may be hindered by several obstacles, especially in the
case of “failed states” or of states that experience a regime change. In this context, Switzerland, a country with
extensive experience in asset recovery, attempted two legislative leaps forward, the rst in 2011 and the
second in 2016. The purpose of this paper is to critically examine the legislative innovations in Switzerland,
with special reference to their strengths, weakness and compatibility with human rights standards.
Design/methodology/approach –This paper draws on legal scholarship, jurisprudence, reports and
other open source data, to analyze two important legislative innovations in Switzerland [Law on the
Restitution of Assets of Criminal Origin of 2010 (LRAI) and law on assets of illicit origin (LVP).
Findings –The two Swiss legislative initiatives that will be examined (LRAI and LVP) are innovative in
nature, but serious weaknesses and obstacles to asset recovery remain unaddressed. Despite their aws, these
two legislative innovations can inspire positive change in international and national norms. They can be
viewed as part of a work-in-progress for the reinforcement of asset recovery proceedings and international
cooperation in this domain.
Originality/value –Since the new law on asset recovery (LVP) came into force (July 1, 2016), this has been
the rst study examining the strengths and weaknesses of the adopted text, its compatibility with human
rights standards and its potential inuence on international standards of asset recovery.
Keywords Switzerland, Corruption, Money laundering, PEPs, Asset recovery
Paper type Research paper
1. The Swiss experience with asset recovery
International asset recovery proceedings target foreign leaders, ofcials and their associates
who increase their personal wealth through acts of corruption or mismanagement and
transfer the plundered assets away from the jurisdiction of origin. International asset
recovery may be hindered by numerous obstacles (Van der Does de Willebois et al., 2011),
such as the sophistication of the methods used to conceal the illicit assets, the length and the
complexity of judicial proceedings and cross-border investigations, the lack of expertise and
willingness of the competent authorities in the jurisdictions involved, etc. Switzerland’s
commitment to ght impunity and not to serve as a depository for the assets of kleptocrats
has become a priority of the Swiss strategy against economic criminality (Conseil fédéral
Suisse, 2012a;FATF, 2005) as well as an integral part of Swiss foreign policy (Conseil fédéral
suisse, 2012b, p. 15). The Swiss experience in asset recovery dates back to the 1980s, the rst
major case being the restitution to the Philippines of funds that had been illegally
accumulated in Swiss nancial institutions by former dictator Ferdinand Marcos during his
time in power. Among several other notable cases, we can mention the restitution of looted
funds to Nigeria (Abacha case), to Peru (Montesinos case) and to Mexico (Salinas case). In
total, Switzerland has succeeded in restituting approximately 1.8bn Swiss Francs of
corruption proceeds to the countries of origin in the past two decades (Conseil fédéral Suisse,
2014, p. 8). Although the Swiss strategy favoring asset recovery has been pursued rather
consistently, new problems have emerged that have rendered necessary the adaptation of the
legal framework. This paper examines some interesting developments in this context, in
The current issue and full text archive of this journal is available on Emerald Insight at:
www.emeraldinsight.com/1368-5201.htm
JMLC
20,2
150
Journalof Money Laundering
Control
Vol.20 No. 2, 2017
pp.150-158
©Emerald Publishing Limited
1368-5201
DOI 10.1108/JMLC-06-2016-0024
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