Finance minister defends offshore business

Finance Minister Ueli Maurer speaking during a parliamentary debate in March Keystone

Swiss Finance Minister Ueli Maurer says there is no need for further regulation in Switzerland - despite the revelations of the Panama Papers. In a newspaper interview, he defended the practice of the rich of investing their money in offshore trusts.

“Offshore firms are not illegal,” Maurer told the Swiss tabloid Blick on FridayExternal link. “That many are founded in Switzerland has to do with the importance of our financial centre.”

“I have a good feeling about it because we have a strict money laundering law. The Swiss Financial Market Supervisory Authority (FINMA) External linkhas it all under strict observation and the Office of the Attorney GeneralExternal link gets involved if there are any suspicions.”

Asked for is personal take on offshore activities for the super-rich, he said: “you have to create possibilities”.

Rich people pay much more taxes than he does, the minister argued. “I am not rich but without the rich I would have to pay more taxes,” said Maurer, who is from the conservative right Swiss People’s Party and recently took over as finance ministerExternal link.

He warned against calling for new laws. There was enough regulation in Switzerland already and one cannot put everything under state control, he said. “We shouldn’t be the world morality police here,” he said. “Those with criminal energy will always find a hole somewhere”.

Maurer’s comments were not echoed by the head of Finma, Mark Branson, on Thursday. He said the country’s banks must clamp down on money laundering in the wake of the Panama Papers.

Panama leak

The International Consortium of Investigative Journalists (ICIJ) first published the so-called Panama Papers on April 3. They list the activities of global banks and financial intermediaries on behalf of wealthy clients. The information was based on a leak from law firm Mossack Fonseca.

Swiss lawyers have been linked to unexplained funds of friends or relatives of Russian President Vladimir Putin and former Chinese Premier Li Peng. The Geneva public prosecutor announced on Thursday that it had launched a criminal investigation in connection with the Panama Papers.

Gianni Infantino, newly elected President of football’s world governing body, FIFA, has also had his name linked to the data during his time as General Secretary of UEFA. This led to raids on UEFA’s Nyon headquarters by Swiss police.

Far-reaching consequences

Britain, France, Australia, New Zealand, Austria, Sweden and the Netherlands are among countries that have already started inquiries.

Iceland’s Prime Minister Sigmundur Davíð Gunnlaugsson has resigned because of the affair and Argentine President Mauricio Macri has pledged to assert his innocence after he was mentioned in the Panama Papers. Britain’s Prime Minister David Cameron has also come under pressure. He revealed on Thursday that he had sold shares he owned in an offshore trust set up by his late father before he started office in 2010.

He said the firm, Blairmore Holdings, had not been set up to avoid tax. The company came up in the Panama Papers and they showed that Cameron’s father was one of five UK directors who flew to board meetings in the Bahamas or Switzerland.