Outrage in Switzerland after company bosses 'buy back luxury cars with coronavirus loans'
Swiss authorities are investigating a scheme whereby entrepreneurs allegedly used money obtained from the country’s coronavirus rescue package to buy back their luxury cars.
As reported in the Tages Anzeiger, a number of Swiss entrepreneurs accessed the funds - but used the money to ‘buy back’ their luxury cars, which they had used to secure loans from upmarket Swiss automobile pawn shops.
Cedric Domeniconi, who founded automobile ‘pawn shop’ Auto Pfandhaus, told Swiss newspaper 20 Minutes that since the lockdown started, several entrepreneurs were suddenly flush with enough cash to buy back their fancy cars.
The car brands included Ferraris, Porsches, Rolls Royces, Aston Martins and Mercedes.
The Swiss government made more than CHF60 billion available as part of the coronavirus rescue package, with CHF40 billion put on the table in low-interest business loans.
“Since the emergency aid for the Covid 19 pandemic started, we have conspicuously picked up many luxury cars from entrepreneurs.”
“We know that many customers use the emergency loans to buy back the pledge that they originally covered with their car."
The car pawnshop provides loans up to a maximum of CHF100,000.
Although coronavirus loan regulations state that loans cannot be used to service other loans, the Tages Anzeiger writes that crafty financial moves have enabled this to take place.
This is because ‘car mortgages’ - i.e. loans where a car is used as collateral - do not appear on Swiss debt registers. This means that transactions can be made without the corresponding data being traceable the paper reported.
Fraud in Vaud
It comes after news from the western canton of Vaud, where the Public Prosecutors Office was looking into an alleged multi-million franc fraud of coronavirus support money.
The fraud was discovered by banks in the canton, who informed the federal police that money received as part of the coronavirus stimulus payments had been transferred abroad.
The alleged perpetrators are Swiss nationals from Turkey, who are suspected of having transferred several million dollars received under the coronavirus loan scheme abroad.
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Cedric Domeniconi, who founded automobile ‘pawn shop’ Auto Pfandhaus, told Swiss newspaper 20 Minutes that since the lockdown started, several entrepreneurs were suddenly flush with enough cash to buy back their fancy cars.
The Swiss government made more than CHF60 billion available as part of the coronavirus rescue package, with CHF40 billion put on the table in low-interest business loans.
“Since the emergency aid for the Covid 19 pandemic started, we have conspicuously picked up many luxury cars from entrepreneurs.”
“We know that many customers use the emergency loans to buy back the pledge that they originally covered with their car."
The car pawnshop provides loans up to a maximum of CHF100,000.
Although coronavirus loan regulations state that loans cannot be used to service other loans, the Tages Anzeiger writes that crafty financial moves have enabled this to take place.
This is because ‘car mortgages’ - i.e. loans where a car is used as collateral - do not appear on Swiss debt registers. This means that transactions can be made without the corresponding data being traceable the paper reported.
Fraud in Vaud
It comes after news from the western canton of Vaud, where the Public Prosecutors Office was looking into an alleged multi-million franc fraud of coronavirus support money.
The fraud was discovered by banks in the canton, who informed the federal police that money received as part of the coronavirus stimulus payments had been transferred abroad.
The alleged perpetrators are Swiss nationals from Turkey, who are suspected of having transferred several million dollars received under the coronavirus loan scheme abroad.
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