Federal Council to enshrine practice of returning stolen PEP assets in law
Bern, 26.06.2024 - The Federal Council is set to propose legislative amendments to enshrine in law Switzerland's practice, developed over the last two decades, on the restitution of illicitly acquired assets of foreign politically exposed persons (PEPs). At its meeting on 26 June 2024, it approved the report in response to the postulate of the Foreign Affairs Committee of the Council of States (FAC-S) of 4 April 2019, which asked the Federal Council to examine whether legislation in this area should be harmonised.
Over the past 20 years Switzerland has worked to ensure that stolen assets confiscated from PEPs are returned to the local populations concerned, and to prevent the money from flowing back into corrupt channels. To date, the Federal Department of Foreign Affairs (FDFA) has negotiated the modalities of nine restitution processes with different foreign states. In three cases, negotiations are ongoing. Each process establishes modalities determining which programmes benefiting the local population are to be funded by the returned assets, and how this is to be monitored.
In its postulate 19.3414 of 4 April 2019 entitled 'New provisions for monitoring the restitution of assets of illicit origin', the FAC-S notes that the negotiation of restitution modalities is expressly provided for in the legislation only when confiscation has been ordered pursuant to the Foreign Illicit Assets Act (FIAA). Because this does not include other procedures where stolen asset restitution may be ordered, such as mutual legal assistance or criminal procedures, the postulate asks the Federal Council to consider whether the legislation should be supplemented to allow the FDFA to monitor the restitution of PEP assets in such cases.
Important for Switzerland to establish a legal basis
The Federal Council's report recommends codifying practice and clarifying the legal framework for legal certainty and transparency. It has therefore instructed the FDFA to submit a proposal for a legislative amendment to enable the Federal Council to decide on a case-by-case basis whether it is in Switzerland's interest to return illicit PEP assets under negotiated modalities. This mechanism would reflect current practice and could be used regardless of the procedure used to confiscate the assets – administrative (FIAA), mutual legal assistance or criminal procedures.
When PEPs abuse their positions for personal gain, they embezzle public money that should have been spent on public services for the local people. It is therefore important for Switzerland to establish a solid legal basis for the restitution of confiscated PEP assets and ensure that they are used to help the local populations concerned.
Address for enquiries
For further information:
FDFA Communication
Tel. Press service +41 460 55 55
kommunikation@eda.admin.ch
Publisher
The Federal Council
https://www.admin.ch/gov/en/start.html
Federal Department of Foreign Affairs
https://www.eda.admin.ch/eda/en/home.html
