Swiss banks' boards must actively manage money laundering risks, regulators say

Swiss financial regulators are sharpening their focus on combating money laundering, with new directives highlighting the crucial role of bank boards. The Swiss Financial Market Supervisory Authority (Finma) has released communications emphasizing that board members must actively engage with annual risk analyses concerning money laundering.

These analyses, presented by a bank's compliance department, should not be treated as a mere formality. Instead, Finma stresses that they must serve as a genuine opportunity for critical reflection. Boards are expected to thoroughly scrutinize the identification of money laundering risks specific to their institution and evaluate the effectiveness of measures in place to manage and mitigate these threats.

The directive underscores a move towards greater accountability at the highest levels of banking governance. By mandating a more engaged and critical approach from boards, Finma aims to bolster the defenses of Swiss financial institutions against illicit financial activities.