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‘Something rotten in Switzerland’: US accuses Swiss of aiding Russia’s war efforts

A US government body has said Switzerland is a destination for “war criminals and kleptocrats”, accusing the Swiss of aiding Russian President Vladimir Putin’s attacks on Ukraine.

Geneva is a popular destination for many wealthy Russians. Image: Daniela Turcanu/Unsplash
Geneva is a popular destination for many wealthy Russians. Image: Daniela Turcanu/Unsplash

The US Government’s Helsinki Commission, an independent body promoting human rights, military security and economic cooperation, said in a briefing on Thursday that Switzerland was “Putin’s assistant” in the Russian leader’s brutal war on Ukraine. 

At the centre of the allegations is the Swiss financial system, which the commission says has allowed the storage of dirty money. 

“Switzerland has long been known as a destination for war criminals and kleptocrats who hide their loot there, and is a leading pioneer of the Russian dictator Vladimir Putin and his cronies” the briefing read. 

British financier Bill Browder, who has been a frequent critic of Putin, told the meeting that Switzerland was letting itself be corrupted by Putin. 

“Something is rotten in Switzerland” Browder said. 

Swiss President Ignazio Cassis rejected the allegations, saying they are untrue. 

Cassis has seen Switzerland impose a range of sanctions on Russians, including some living in Switzerland. 

Sanctions on Russia: Is Switzerland still a neutral nation?

One Russian oligarch living in the Swiss city of Geneva applied for social assistance after his accounts were frozen. 

‘We cannot find them’

While Switzerland has taken steps in recent years to shed its status as a destination for dodgy money, critics argue that the Swiss system still makes it difficult to trace funds. 

Swiss corruption expert Mark Pieth told RTS that Switzerland was still one of the world’s biggest destinations for illicit funds. 

“The problem is that oligarchs have funds in Switzerland and we cannot find them because they are behind so-called letterbox companies and offshore accounts” he said. 

“Places are hidden. This means that only certain specialised lawyers really know who the beneficial owners are and they are not obliged to provide the federal government with information.”

On April 28th, 2021, in his first State of the Union address as US president, Joe Biden referred to Switzerland as a “tax haven”.

His exact words were: “A lot of companies also evade taxes through tax havens in Switzerland and Bermuda and the Cayman Islands”.

ANALYSIS: Is Switzerland actually a tax haven?

The Helsinki Commission is a group made up of politicians, government representatives and parliamentary experts. 

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Why is Switzerland importing Russian gold?

Despite sanctions currently in place, Switzerland imported several tonnes of gold from Russia in May. Has Switzerland broken any rules?

Why is Switzerland importing Russian gold?

More than three tonnes of gold, worth around $200 million, were shipped from Russia to Switzerland in May, nearly two months after the beginning of war in Ukraine, according to media reports based on data from the Federal Office for Customs and Border Security.

While questions may arise why Switzerland, which adopted EU sanctions against Russia on February 28th, is still trading with Moscow, this move is not breaking any rules.

That’s because sanctions are not targetting commercial gold shipments, even though “many banks, shippers and refiners stopped dealing with Russian metal after the conflict in Ukraine began”, according to a report in Reuters.

In fact, Switzerland is an important hub in the international gold trade, with its four major refineries producing two-thirds of the world’s gold. Interestingly, all four have denied importing from Russia after the invasion.

Meanwhile, the news of the imports has sparked criticism.

Marc Ummel, head of raw materials at Swissaid humanitarian aid organization, fears that proceeds from the gold will be used to finance the war.

The gold imports caused much debate on social media and internet forums.

One critical social media user pointed to the link between the latest shipment and Switzerland’s wartime practices: “The first things that come to mind when you think of Switzerland are dodgy bankers and Nazi gold”.

“How very Switzerland of them”, another critic wrote.

READ MORE: Sanctions on Russia: Is Switzerland still a neutral nation?