From 1934 to today: secrecy, capital flight, dormant assets and asylum

Article 47 BankA in its present form

Article 47 of the Banking Act is still in force, more than ninety years after its enactment, but its function has changed. Its present version punishes with imprisonment of up to three years or a monetary penalty anyone who intentionally discloses a secret entrusted to him in his capacity as a member of a bank's organs, employee, agent or liquidator, or of which he has become aware in that capacity, as well as anyone who incites another to such a violation.¹ After the sale of stolen client data to foreign tax authorities between 2008 and 2010, a parliamentary initiative of 17 June 2010 demanded harsher penalties. The Economic Affairs Committee of the National Council proposed two additions in its report of 19 May 2014: a new letter c that punishes anyone who discloses to others a secret revealed to him in breach of Article 47 or exploits it for his own or a third party's benefit, and a new paragraph 1bis that raises the maximum penalty to five years' imprisonment for offenders who obtain a financial advantage for themselves or another.² The amendment entered into force on 1 July 2015.³ Negligent violations are punishable by a fine of up to CHF 250,000.⁴

The protected interest has not changed since 1934: the confidentiality of the client relationship. What has changed is the scope of the secrecy against authorities. Article 47 reserves, as it did in 1934, the federal and cantonal provisions on the duty to testify and to provide information to an authority.⁵ Since the end of the 2000s Switzerland has extended these provisions to foreign tax authorities through the standard of exchange of information on request, the Swiss–Italian Protocol of 23 February 2015 and the automatic exchange of financial account information, which Chapter E.II treats in detail. Banking secrecy in the sense of 1934 survives against private persons, journalists and foreign authorities acting outside the legal channels. It no longer protects Italian residents against their own tax administration. The criminal provision that was created, among other reasons, to shield French clients from the inquiries of 1932 now protects the legal procedures through which information flows to foreign States from leaks and illegal data sales.

Capital flight in the banks' code of conduct

The Italian currency controls that drove the first flows of Italian money to Lugano are long gone. Italy liberalized capital movements by 1990, in line with the European Community's directive on the free movement of capital, and the Treaty on the Functioning of the European Union today prohibits all restrictions on capital movements between Member States and third countries, subject to limited exceptions (Art. 63 TFEU).⁶ The Swiss law of due diligence, however, still contains a chapter on capital flight. The Agreement on the Swiss banks' code of conduct with regard to the exercise of due diligence (CDB 20), in force since 1 January 2020, provides in Article 47 that banks may not provide any active assistance in transferring capital from countries whose legislation restricts the investment of funds abroad.⁷ Article 48 defines flight of capital as "the unauthorised transfer of capital in the form of foreign exchange, banknotes or securities from a country that forbids or restricts such transfers abroad by its residents".⁸

The prohibited forms of assistance listed in Article 50 CDB 20 read like a summary of the techniques described earlier in this chapter for the 1930s and in Chapter D.II for the post-war decades: organizing meetings abroad to accept funds, participating in offsetting transactions designed to facilitate the flight of capital, collaborating with persons or companies who organize illegal transfers and referring clients to them. Visits to clients abroad remain permitted, provided that the bank's representative does not accept funds that may not legally be transferred, does not advise on illegal transfers and does not participate in offsetting transactions (Art. 51 CDB 20). Article 52 states that assets of foreign clients in Switzerland may be accepted.⁹ The structure of the rule reproduces the old asymmetry. Switzerland does not enforce foreign currency law by prohibiting the acceptance of foreign money, but it prohibits its banks from actively participating in the violation. For Italian clients the chapter has lost its practical importance. For clients from States that still restrict capital exports it remains live law, and its history in Ticino explains its wording.

Notes

1. Commission de l'économie et des redevances du Conseil national, Iv.pa. Réprimer durement la vente de données bancaires, report of 19 May 2014 (10.450), https://www.parlament.ch/centers/documents/fr/bericht-wak-n-10-450-2014-05-19-f.pdf, describing the existing Art. 47 (imprisonment of up to three years or monetary penalty). The list of persons covered (organs, employees, agents, liquidators) follows the present text of Art. 47(1)(a) BankA, SR 952.0, German text at https://www.droit-bilingue.ch/de-fr/9/95/952.0-47-100.html. ↩
2. Report of 19 May 2014 (above). ↩
3. Art. 47(1)(c) and (1bis) BankA, SR 952.0, inserted by the Federal Act of 12 December 2014, in force since 1 July 2015 (AS 2015 1535), German text at https://www.droit-bilingue.ch/de-fr/9/95/952.0-47-100.html. ↩
4. Art. 47(2) BankA (above): "Wer fahrlässig handelt, wird mit Busse bis zu 250 000 Franken bestraft." ↩
5. Art. 47(5) BankA (above): "Vorbehalten bleiben die eidgenössischen und kantonalen Bestimmungen über die Zeugnispflicht und über die Auskunftspflicht gegenüber einer Behörde." ↩
6. Council Directive 88/361/EEC of 24 June 1988 for the implementation of Article 67 of the Treaty, https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:31988L0361; Art. 63 TFEU, quoted in Wikipedia (English), "Free movement of capital", https://en.wikipedia.org/wiki/Free_movement_of_capital (consulted as a last resort); Banca d'Italia, "Dagli anni cinquanta a Maastricht", https://www.bancaditalia.it/chi-siamo/storia/anni-cinquanta/index.html: "Nel 1990 il completamento della liberalizzazione valutaria chiuse un ciclo di legislazione vincolistica iniziato nel 1934." ↩
7. Swiss Bankers Association, Agreement on the Swiss banks' code of conduct with regard to the exercise of due diligence (CDB 20), https://www.swissbanking.ch/_Resources/Persistent/6/2/e/e/62eec3df0685e359c5a376dfca79dec8b90 8ea9c/SBA_Agreement_CDB_2020_EN.pdf, Art. 47. ↩
8. CDB 20 (above), Art. 48. ↩
9. CDB 20 (above), Arts. 50–52. ↩

For general information only. This article does not constitute legal or tax advice, does not replace advice on an individual case and creates no lawyer-client relationship. It reflects the legal position as of August 2025.