Swiss lawmakers are pressing to soften draft regulations meant to counter money laundering, citing concerns that overly strict rules could put Switzerland at a disadvantage in the fiercely competitive world of cross-border wealth management. As rivals like Singapore and the UAE gain ground, political leaders argue that regulation must be balanced with preserving the nation’s financial allure.
Switzerland currently holds the title of the world’s top wealth-management hub. However, consulting research indicates it may soon lose that position as growth in cross-border wealth in competing centers begins to outpace it.
The government’s proposed legislation, drafted in line with recommendations from the Financial Action Task Force (FATF), aims to increase transparency in financial transactions, curb shell company misuse, and enforce tougher due diligence for financial intermediaries. Yet lawmakers from several parties argue the proposals create excessive bureaucracy and may reduce Switzerland’s competitiveness.
Barbara Steinemann of the Swiss People’s Party voiced frustration, saying that foreign pressure has consistently pushed Switzerland to adopt strict transparency rules that raise compliance costs without delivering clear benefits.
Parties like the Liberals, the Swiss People’s Party, and The Centre—which together hold a parliamentary majority—have introduced amendments that scale back key obligations. Stricter due diligence and beneficial ownership registration requirements for advisers, lawyers, and trustees have been reduced, while some trust arrangements have been exempted from transparency altogether.
Simone Gianini of the Liberals cautioned that Switzerland needs regulation but warned against over-regulation, especially when other financial hubs do not face the same requirements.
Finance Minister Karin Keller-Sutter, however, has warned that weakening the rules too much could damage Switzerland’s global reputation as a safe and credible financial center. This tension reflects a broader challenge faced by finance-driven nations: balancing compliance with international norms against the need to remain attractive to global investors.
Lawmakers have already excluded charities and non-profit organisations from beneficial ownership disclosure and eased rules for legal professionals regarding due diligence.
At the same time, data shows Switzerland is losing ground in attracting cross-border wealth, with Hong Kong expected to overtake it as the leading center within the next year. The possibility of losing its status has added urgency to the ongoing political debate.
In short, the country’s proposed anti-money laundering reforms remain stuck between two powerful forces—global regulatory pressure pushing for stronger safeguards, and domestic concerns that too many restrictions could drive clients and capital elsewhere.
