FINMA seeks to relax Swiss AML rules for small companies

August 29, 2018
Chris Wheal

The Swiss Financial Market Supervisory Authority (FINMA) has said it plans to loosen anti-money laundering (AML) rules for some of the smaller fintech firms to help drive innovation in the crypto-friendly country.

Switzerland to relax rules on anti-money laundering for small companies

Switzerland is carving out a position as hub for fintech innovation, particularly in the town of Zug – fast becoming known as “Crypto Valley” – where digital currency exchanges and blockchain companies are clamouring to set up store.

Smaller companies

While all companies must comply with due diligence rules and take regulatory steps to “know your customer” (KYC) and ensure they’re doing all they can to prevent money laundering, the rules may be relaxed slightly for smaller companies aiming for new licences.

“As a rule, all financial institutions are subject to similar due-diligence requirements relating to combating money laundering,” FINMA said in a statement on Tuesday.

“However, as most fintech licence applicants are likely to be smaller institutions, FINMA proposes to introduce some organisational relaxations for such institutions.”

In this case, smaller institutions are defined as those whose gross revenues are less than SFr1.5m ($1.54m) annually.

Swiss banking act

FINMA suggested the change to the AML rules after the parliament in June voted to amend the Swiss Banking Act to create a new fintech licence category for companies that provide certain bank-like services but don’t make money on investing or interest on deposits.

One provision under the new licence rules for smaller firms will relax the necessity for them to establish independent anti-money laundering units within their business.

Consultation on the plans last until 26 October. The Federal Council aims to implement the revised Banking Act with effect from 1 January 2019, and FINMA hopes its amendments for smaller companies will enter into force at the same time.

Post written by Chris Wheal
Chris Wheal is editor of OpenLedger's news and features service. An award-wining business journalists himself, he runs a team of freelance journalists from across the UK and north America.

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