TIME EUROPE
FEBRUARY 7, 2000 VOL. 155 NO. 5
Silence Is Not Always Golden
Swiss banks' "ask-no-questions" policy has become a major liability
By ROD USHER
Big-time thieves tend to take good care of other people's money. And what better place to squirrel away ill-gotten gains than a bank? In Switzerland, of course, because everyone knows that Swiss banks never go bust, are as all-purpose as the army's knife, and are the very soul of discretion. Where else would Ferdinand Marcos have stashed his half-billion-dollar nest egg? Or Haiti's Jean-Claude "Baby Doc" Duvalier his plunder? Or Zaïre's Mobutu Sese Seko his filched fortune?
But while the Swiss banks' policy of "ask-no-questions-hear-no-lies" has been highly lucrative for them for decades, the code of silence has fast become their biggest liability. Revelations about the handling of funny money have hurt the nation's reputation, with jokes about Swiss banks being more like laundromats. Humor turned to horror after it was revealed in 1995 that the secrecy covered up dormant accounts of victims of the Holocaust. Now, details are emerging about one of the greediest of all Swiss customers, the late Nigerian dictator Sani Abacha.
Before he died in 1998 at the age of 54--in the company of prostitutes, reportedly of a heart attack caused by sexual exhaustion--General Abacha and his henchmen are believed to have robbed the Nigerian treasury of as much as $4 billion since taking power in 1993. Corruption in Nigeria was so bad that at one stage a country which exports $10 billion worth of oil a year had to import refined products.
The figures on the looting come from the Nigerian government, now under the elected leadership of Olusegun Obasanjo. According to papers it filed in Bern last year, Abacha had the money withdrawn from the Nigerian Central Bank under false pretenses. The present government's Geneva-based lawyers, Enrico Monfrini and Yves Klein, say these included fictitious contracts for arms and the purchase of vaccines, or aid to "sister nations" in Africa. Much of the loot was invested in property in Nigeria, but some $2.2 billion went to foreign banks or offshore companies.
An interim Nigerian government offered an amnesty to Abacha's cronies and family members who returned corruptly acquired money and property. That quickly brought in more than half a billion dollars, but the hunt continues to retrieve deposits in Britain, Germany, Belgium, France, Luxembourg and especially Switzerland.
Under laws introduced in 1998, money laundering became a criminal offense in Switzerland--except for foreign tax evaders. Pushed through by then federal prosecutor Carla del Ponte, the laws obliged banks to report suspect deposits, including those made by or for "public figures," to the authorities. Banks must now show due diligence, no longer being able to shrug and say they didn't know the funds' real origin. This may have been the reaction when the first Abacha account was opened with Credit Suisse Bank in Zurich in 1995. Making the $200 million deposit was his then 26-year-old son Mohammed. A senior federal police official in Bern said last week: "If the Credit Suisse claim that there was nothing wrong with a $200-million deposit from a 26-year-old businessman from Nigeria, the world's most corrupt country, then that's hard to believe." However, a spokesman for Credit Suisse said Swiss banking laws prevented him from discussing "real or imagined" clients.
Meanwhile, Swiss prosecutors and the Banking Commission in Bern are continuing Del Ponte's tough line. After Nigeria's request for help, $550 million in Abacha-linked deposits was frozen last October. Last month, another $104 million was blocked. One of those most determined to clean up Switzerland's act is Bernard Bertossa, chief prosecutor of the canton of Geneva. But he warned last week that doing so will serve little purpose if nothing changes in Liechtenstein, Switzerland's tiny neighbor, which remains Europe's prime haven for shady money. "While we can access any Swiss deposit in criminal investigations, Liechtenstein has never opened a bank account yet," he complains.
Bertossa predicted, when the anti-laundering laws were introduced two years ago, "maybe now a Swiss banker will go to jail for the first time." That has not happened so far, nor has the Banking Commission exercised its power to withdraw an operating license. But the Abacha investigators still have a long way to go. And they are yet to begin work on another request for "juridical assistance," this time from the new government of Ivory Coast. It is missing $28 million of European Union funds sent there to fight AIDS--and suspects it may have quietly found its way into a Swiss bank account.
Reported by Robert Kroon/Geneva
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