Included in Wednesday's sanctions package, OFAC designated two Swiss lawyers for creating companies and trusts to help Russian clients evade sanctions.
Andres Baumgartner and Fabio Libero Delco facilitated the illicit flow of funds while avoiding oversight due to a loophole in Swiss law that allows lawyers to serve as non-financial intermediaries under the guise of their profession without due diligence or reporting requirements.
"Baumgartner and Delco have provided trust and corporation formation services to many Russian clients, including sanctioned Russian individuals. Baumgartner and Delco are each the director of many Russian-owned entities.," according to the OFAC announcement.
The US Embassy in Bern said "Ambassador Miller has publicly and privately cautioned Switzerland about the reputational costs associated with this loophole.
Ambassador Scott Miller says, “Switzerland is both a global financial hub and a key part of the international sanctions framework. It can and must do more to ensure its legal framework is not used for illicit financial activity.
"We continue to urge Switzerland to close the loopholes in its anti-money laundering (AML) legislation to ensure that lawyers serving as non-financial intermediaries are subject to the AML oversight requirements, to improve management of the financial industry, and to strengthen enforcement of sanctions.”
"Targeting trust and corporate formation services enabling sanctions evasion, as we have done today, lets would-be evaders and circumventers know that their actions have consequences.
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