BERN, SWITZERLAND – Switzerland moved Wednesday 18 May to align itself with the European Union in blocking the assets of 13 Syrian leaders and forbidding them to enter or transit Switzerland.
The sanctions are accompanied by an arms embargo, in response to serious human rights violations by the government of Syria against its own citizens, also bans the export of all military goods and other goods that could be used for military purposes, and the use of any financial tools that facilitate military deliveries to Syria. A detailed list of goods was published by Bern.
European Union reacts to news of 11 more civilian deaths by Syrian forces
Protesters across Syria took to the streets, calling for President Bashar al-Assad’s resignation Friday, after prayers, and security forces reacted with force, killing 11 more people, according to human rights activists. The European Union, which has been threatening financial sanctions, “agreed today to impose asset freezes and travel restrictions against Syrian officials responsible for the violent repression, which rights campaigners say has killed more than 560 people,” reports the Irish Times.
Details of who is affected by the sanctions and what assets are being blocked were not announced immediately by the EU but news agency AFP says it was told 13 officials are affected, but not the Syrian president, and that the freeze will be reviewed Monday.
Links to other sites: BBC, Guardian, Le Monde (Fr)
Zurich, Switzerland (GenevaLunch) - Swiss President Micheline Calmy-Rey, in Tunisia Monday 2 May for a meeting of regional ambassadors from Switzerland, told Swiss news agency ATS that to date a total of CHF830 million in funds linked to three Middle Eastern dictators have now been identified and therefore frozen.
The Swiss Foreign Ministry had previously said only that “tens of millions” of assets linked to Mubarak had been found in the week after the government sent the order to financial institutions to block the funds. The government had not until Monday given figures for Ben Ali or Qadaffi and those close to them.
Banks and other financial institutions must try to identify and freeze assets immediately, once the order to do so is sent by Bern. The fine for not providing information is CHF20,000 plus a fine of 10 times the value of the object, whether it is bank funds or real estate or other assets.
The amounts Calmy-Rey announced appear small compared to many estimates for the wealth of the three. The Financial Times‘s Haig Simonian in Zurich writes that the CHF360 million mentioned in connection with Qadaffi is “a surprisingly high figure, considering Colonel Muammer Gaddafi had declared he had withdrawn all funds – amounting to some $5bn – from Switzerland after a bitter dimploatic spat between the two countries two years ago.”
The Wall Street Journal points out that the Qadaffi assets in Switzerland are far smaller than the $30 billion frozen by the US.
The amounts given by Calmy-Rey, who is also Switzerland’s foreign minister:
- CHF360 million Libya’s Muammar Qadaffi, frozen 21 Frebruary 2011
- CHF410m Egypt’s Hosni Mubarak, frozen 2 February 2011, about 10 percent of all Egyptian assets in Switzerland that the Swiss central bank could identify as originating from Egypt at the end of 2009.
- CHF60 Tunisia’s Ben Ali, frozen 19 January 2011: this is about 10 percent of the assets the Swiss central bank said were in Switzerland and that originated in Tunisia at the end of 2009.
The amount of money in Swiss banks, from Libya and Egypt, has fallen steadily since 2005, according to the Swiss National Bank, possibly reflecting Switzerland’s increasingly tough stance on actively identifying dictators’ assets.
In addition to the three listed above, Switzerland in 2011 also froze the assets of former Ivory Coast President Laurent Gbabgbo, 19 January.
Update 12:50 Bern / Zurich, Switzerland (GenevaLunch) – The argument over who gets the Duvalier millions, some CHF5.8 million of them, will finally be heard in court, with the Swiss government 2 May initiating forfeiture proceedings at the Swiss Administrative High Court. The proceedings are the first under a Swiss law that went into effect in February 2011. The Haiti proceedings are also currently the only case requested by the federal government, spokesperson Roland Meier told GenevaLunch, but, he notes “the law was created to cover other cases” as needed.
The new law allows what are known as failed countries to ask for help without pressing criminal charges first, a lengthy, costly and often, as in the case of Haiti, near-impossible task.
If the government’s case for restitution is successful, “the Swiss Confederation will return the Duvalier assets to Haiti in accordance with the provisions of the new Federal Act on the Restitution of Unlawful Assets (RUAA).
The funds were frozen in 1986 shortly after Jean-Claude Duvalier fled Haiti, ending his family’s decades-long dictatorship. They have been continually frozen in Switzerland since then.
Amount that could go to Haiti probably more than CHF5.8 million
The forfeited assets should amount to somewhat more than CHF 5.8 million, according to the Federal Department of Finance (FDF), which announced the opening of proceedings.
The amount appears to have risen and fallen over the years, but Meier, spokesperson for the FDF, told GenevaLunch that it is not yet clear if this is because the funds were in dollars and the dollar has moved against the franc, or if the amount involved is only part of the original funds in question.
Duvalier said in February 2011 that the money belonged to his family’s foundation, and he mentioned a sum of CHF6.8 million. At that time the Swiss government spoke of $5.8m, not Swiss francs (background story, GenevaLunch). Asset Recovery, which has published an online history of the attempts to give the Duvalier funds to Haiti, mentions $4.8 million in 2009. Reuters notes today that the amount of which Duvalier has been accused of embezzling is between $300,000 and $800,000.
Duvalier returned to Haiti 21 January 2011 for the first time since he left in 1986, saying he wanted to help his people, following the massive earthquake there. He had been living in exile in France, initially with a luxurious lifestyle, but he lost much of his money in a costly divorce to his wife Michele.
25 years to close the Swiss law loophole
The RUAA was created to close a loophole in Swiss law that had made it impossible for Switzerland to return the money to Haiti, which never had a stable government long enough in the post-Duvalier days to be able to instigate a claim itself and supply the information required by Switzerland.
Swiss authorities, who made it clear over the years they did not believe the money should be allowed back in Duvalier family hands, kept the funds blocked, but early in 2010 there was a close call where it appeared that Switzerland would not be able to legally continuing blocking the funds.
The federal government 2 February, the day after the new law went into effect, asked the Federal Finanace Department to start proceedings.
Background story, Duvalier funds, GenevaLunch, February 2010
Bern lists 26 whose assets must be blocked by banks and others
Update 21:40 Bern, Switzerland (GenevaLunch) – The Swiss Foreign Affairs Department Thursday announced that banks and other financial institutions have been given the order to block assets belonging to Libyan leader Muammar Qaddafi, his family and those close to him, starting at 18:00 24 February, for a period of three years. The step was taken, Bern says, to avoid the possibility of any Libyan state funds that remain in Switzerland from being misappropriated by the Qaddafi clan.
The 26 persons whose assets must be frozen are listed below but it is not clear how much money or real estate they may hold in Switzerland and that would thus be blocked.
Libyan assets in Swiss banks likely to be relatively small
Libya once reportedly held considerable assets in Switzerland, but following the 2008 affair where Hannibal Qaddafi, the Libyan leader’s younger son, was arrested in Geneva, much of the money was pulled out of Swiss banks, the Libyan state news agency said in June 2009, citing a figure of CHF7 billion. Swiss sources at the time said the figure was closer to CHF5 billion.
The 2009 Swiss National Bank’s (SNB) annual reports on banks show Libya to have had only CHF613 million invested in Switzerland, in liabilities, a drop from CHF1.2 billion in 2005, figures well below those given by Libyan sources. Fiduciary funds had also dropped to half of the 2005 level, from CHF402m to CHF205m.
The SNB numbers cover all investments in Switzerland, by the government, companies and individuals.
Switzerland has been quicker than other countries to freeze the assets, with Qaddafi still technically in office, just as it was with assets of Egypt’s fallen leader Mubarak and Tunisia’s Ben Ali.
Once the government in Bern gives the order to freeze assets banks and financial institutions are obliged to report these quickly to the government. The fine for not providing information is CHF20,000, plus a fine of 10 times the value of the object.
Qaddafi clan named
Bern, Switzerland (GenevaLunch) – Thirty banks and financial institutions have reported and blocked some CHF80 million in assets belonging to former Tunisian dictator Ben Ali, Swiss federal police office spokesperson Danièle Bersier said Sunday. He confirmed to news agency ATS information that had appeared earlier in the day in Swiss newspaper SonntagsZeitung.
Ben Ali fled Tunisia 19 January and five days later the federal government issued an order to freeze assets belonging to him and 40 people in his entourage. The new Tunisian government will now need to request judicial assistance in order to start a court case to obtain the funds if they were obtained illegally.
Bern, Switzerland (GenevaLunch) – Switzerland’s new law covering potentate funds, dictator’s assets frozen in Swiss banks, goes into effect 1 February 2011. The first beneficiary of what is called the Restitution of Illicit Assets Act is likely to be Haiti, which is scheduled to receive CHF6 million that have been frozen since Jean-Claude Duvalier, known as Baby Doc, fled the country in 1986.
Baby Doc’s surprising return to Haiti 17 January has provoked questions about why he would risk prosecution, and one of the suggestions put forward is that he hopes to keep the Swiss from returning money his family stashed in Swiss banks. The Duvaliers fought long and hard to force Switzerland to unfreeze their assets, saying these were legally gained. Baby Doc’s notoriously expensive lifestyle and divorce in France have sparked rumours that he is short of money.
Switzerland has struggled to keep the funds out of the Duvalier clan‘s hands for several years, cobbled by its own laws that said funds could be returned only if a country asks for judicial assistance once the dictator is gone. Haiti’s plight, a country too poor and disorganized to ask for help, underlined the shortcomings of the law.
The new law, passed in October 2010 (text), will, under certain circumstances, make it possible to return funds to a country that has not been able to follow the normal international legal path to demand their return.
Duvalier, whose motives for returning to Haiti remain a mystery, now faces charges of fraud and embezzlement.
Links to other sites: BBC, France24/AFP, New York Times
Swiss high court ruling on Haitian ex-dictator Jean-Claude Duvalier’s money will lead to new law
Talloires, France, near Geneva, where the Duvaliers fled after leaving Haiti in 1986 (photo: Talloires Tourisme)
Update (links added) 23:30 Bern, Switzerland (GenevaLunch) – The Swiss government Wednesday morning 3 February took the unusual step of freezing funds in a bank account once held by Haiti’s former dictator, Jean-Claude Duvalier, based on a special cases clause in the Swiss constitution. At the same time the Swiss supreme court published its ruling on the frozen assets, saying that they cannot be returned to the Haitian people as mandated by the Swiss Office of Justice in 2009. The court decision has prompted the Swiss Federal Council to freeze the funds long enough to pass a law that will help it avoid releasing the assets “for the benefit of the Duvalier clan, which the Federal Criminal Court deems to be a criminal organization.”
A new law would allow the Swiss parliament input on how to best return the money to Haiti.
The ruling Federal Council is asking the Foreign Affairs Department to “complete by the end of the month its work on drafting a federal law that would ultimately allow such assets to be confiscated, and to submit the draft law for consultation.” A spokesperson for the Federal Foreign Affairs Office told GenevaLunch that the law is likely to be passed in 2010. It will cover similar situations of confiscated assets, several of which have come up in recent years.
Switzerland is the only country in the past 20 years to have returned stolen “potentates” funds to the countries previously ruled by the dictators: more than CHF1.6 billion has been returned to Peru, the Philippines and Nigeria among others.
The Duvalier family has been fighting to obtain access to $5.7 million sitting in Swiss bank accounts since they were frozen in 1986, when the Haitian government made a first request for assistance to obtain what it said were stolen funds. Jean-Claude Duvalier, popularly known as Baby Doc, ruled Haiti starting in 1971, when at age 19 he became the world’s then-youngest ruler. His father, known as Papa Doc, had ruled it for the previous 13 year.
Geneva, Switzerland (Tribune de Geneve, Fre) – Bank accounts have been blocked in Geneva by the Swiss government in relation to the “Anglo Leasing” scandal in Kenya, which may go back more than 10 years, that involved money-laundering related to purchases of helicopters and officials’ cars, NZZ in Zurich reports. The Tribune picks up the story.
