News
Swiss prosecutors end Magnitsky investigation without bringing charges
28 Jul 2021

Swiss prosecutors have closed a decade-long investigation into the money-laundering scandal exposed by Russian lawyer Sergei Magnitsky, the latest in a string of setbacks in the country’s efforts to tackle financial crime.

The decision to end the probe without any charges being brought was a “stain on Switzerland”, said investor Bill Browder, Magnitsky’s former employer and a campaigner against Russian kleptocracy.

Magnitsky died in 2009 after being tortured and mistreated in a Russian jail, where he had been sent after Russian officials accused him of colluding with Mr Browder to defraud the Russian state.

Mr Browder’s fund, Hermitage Capital, was for years the largest foreign investor in Russia. It was in fact the victim of a fraud, in which Russian officials siphoned off $230 million using faked tax documentation, later accusing the fund itself to cover their tracks.

Laundered

Switzerland was one of the key conduits through which the Russian officials were thought to have laundered the money. About $24 million (€20.3 million) linked to the fraud is still frozen in accounts at Credit Suisse and UBS.

The collapse of the case comes amid accusations of bribery and political meddling at the highest levels of the Swiss federal prosecutor’s office.

A senior Swiss official was last summer found guilty by the Swiss federal criminal court of accepting extravagant gifts from Russian legal officials, including a Siberian bear-hunting trip, during which he discussed sensitive matters concerning the Magnitsky case.

Michael Lauber, the federal prosecutor, was forced to resign last year in the face of impeachment proceedings by Swiss parliamentarians. His successor has yet to be appointed.

Yet the collapse of the investigation into the Magnitsky money trail has been anticipated for some time: the probe has dragged on for years without progress.

Anti-corruption

Magnitsky’s name has become a byword for western anti-corruption efforts. So called “Magnitsky laws”, which empower governments to act against foreign officials they suspect of human rights abuses, have come into force in the US, UK and European Union.

By Sam Jones, Financial Times, 27 July 2021

Read more by the Financial Times via The Irish Times

RiskScreen: Eliminating Financial Crime with Smart Technology

Count this content towards your CPD minutes, by signing up to our CPD Wallet

FREE CPD Wallet