On March 19, 2021, the amended Anti-Money Laundering Act (AMLA) was adopted by the Swiss Parliament. In October the Federal Department of Finance has started the consultation procedure for the to be revised Ordinance to the AMLA.
The AMLA is a federal law that oversees the fight against money laundering and terrorist funding. It covers financial intermediaries and dealers who take cash payments. Examples are banks, asset managers, trustees, investment firms with variable capital, and other financial intermediaries.
The presented amendments to the ordinance primarily specify the measures more in detail that has been adopted by the Swiss Parliament. In addition, relevant provisions on reporting from the money laundering ordinances of the supervisory authorities and the Federal Department of Justice and Police (FDJP) are to be transferred to the Federal Council's Money Laundering Ordinance.
The adaptations are necessary due to the change of the legal basis adopted by the Swiss Parliament: The Swiss Federal Government has suggested adjustments to the AMLA to follow recent FATF (Financial Action Task Force) recommendations. The revised AMLA is focused to align Swiss legislation with the latest guidelines of the FATF on Money Laundering.
The amendments also aim to increase the transparency of bearer stock issuers.
Important new provisions of the revised AMLA are as follows:
- Art. 4 paragraph 1 revised AMLA now requires financial intermediaries not only to identify the beneficial owner with due diligence but to verify this information.
- The revised AMLA further requires the financial intermediary to periodically review the supporting documents (identification, beneficial ownership, and other documents) to ensure that they are up to date or to update them as necessary (art. 7 paragraph 1bis revised AMLA). The financial intermediaries need to apply a risk-based approach to define a sufficient periodical review.
- Art 9 of the revised AMLA has been changed by adding the new paragraph 1 quarter, which further defines the meaning of "reasonable grounds to suspect" money laundering and, as a result, technically does not establish a new SAR threshold. However, it clarifies that there is an obligation to notify where at least one specific indicator or a combination of indicators give grounds to suspect money laundering, and subsequent clarifications under Art. 6 AMLA fail to resolve the concern.
The FATF (Financial Action Task Force) and the Organization for Economic Cooperation and Development (OECD) recommend using a system that allows authorities to access information on beneficial owners in the shortest time feasible to prevent and combat the misuse of these legal vehicles effectively.
As of today, the revised AMLA and the corresponding ordinance shall be come into force around mid 2022.