Swiss Court Orders Fresh Ruling for Whistleblowers in Cum-Ex Fraud
Swiss Supreme Court Revives Case Involving Bank Secrecy and Cum-Ex Scandal
Background of the Case
ZURICH, July 22 (Reuters) - Switzerland's highest court has ordered a fresh ruling in the case of three men accused of breaching bank secrecy laws over leaked data that helped expose the cum-ex tax fraud scandal — one of Europe's largest financial crimes.
The three men, who are not named in the court document, were convicted in 2019 of charges including banking espionage and violating banking secrecy, a verdict that was overturned on appeal in 2021.
Legal Proceedings and Overturned Verdict
After years of further legal wrangling, the Zurich High Court eventually dropped the case, citing lengthy delays and finding the investigating prosecutor had been biased.
Following an appeal by the Zurich Public Prosecutor's Office, the Federal Supreme Court has now sent the case back to the High Court, ruling that neither the delays nor the alleged bias justified halting proceedings.
"The case is remanded to the lower court for a new decision," the Federal Supreme Court said.
Key Individuals and Charges
Involvement of Eckart Seith and Bank Employees
German press agency DPA said the case involved Stuttgart lawyer Eckart Seith, who faced charges after presenting German authorities with Swiss bank documents that triggered proceedings surrounding the illegal cum-ex transactions.
Two former German employees of Bank J. Safra Sarasin were also charged in the case, according to DPA.
Seith and his lawyers did not respond to requests for comment from Reuters.
Swiss Banking Secrecy Laws and Cum-Ex Fraud Explained
Strictness of Swiss Banking Secrecy
Swiss banking secrecy laws make it a criminal offence for bank employees or third parties to disclose confidential client information, with no exemption for exposing wrongdoing.
Mechanics of the Cum-Ex Fraud
The cum-ex fraud involves the complex stock trades where banks and investors would trade shares of a company rapidly around the time it paid out a dividend.
The goal was to trick the government into refunding a tax that was only paid once. The German finance ministry halted the practice that experts calculated had cost the treasury up to €12 billion.
European Legal Perspective
"The investigation of serious crimes, even by those bound by confidentiality, is desired and protected by the European legal order," Seith told German news agency DPA.
"I do not expect Switzerland to place itself outside the European legal order."
(Reporting by John Revill; Editing by Hugh Lawson)
