Swiss Official Says 300
Firms Linked To Russian Mafia


GENEVA - (Reuters) Organized crime gangs from the former Soviet Union have infiltrated some 300 Swiss companies and are using Switzerland as a "piggy bank", the country's Attorney General Carla del Ponte was quoted on Sunday as saying.
In a rare interview the outspoken Del Ponte, who on Friday was nominated by U.N. Secretary-General Kofi Annan for the post of chief prosecutor of the world body's war crimes tribunal, said mafia groups continued to launder money in Swiss banks despite the introduction of a stringent a new law in 1988.
"The Swiss economy is being undermined more and more by the mafia from the East. We estimate that around 300 Swiss companies have already been infiltrated," Del Ponte told the Swiss-German Sunday newspaper SonntagsBlick.
A government report last year said some 80 Swiss companies had been penetrated by mafia groups from the East.
Asked what made Swiss banks so attractive to the mafia, Del Ponte, who has long been the "bete noire" of secretive Swiss private bankers, said: "Their services and the legend of banking secrecy."
Switzerland is the world's biggest offshore banking center for the wealthy accounting for about a third of the market.
Determined to fight its reputation as a haven for so-called "dirty money", Swiss authorities introduced a new money laundering law last April.
It was opposed by many Swiss bankers who saw it as a threat to their business and to what was once seen as iron-clad protection for their wealthy clients.
Banking secrecy is the backbone of a business that manages an estimated $2 trillion or more in private client assets in Switzerland.
The new law made it obligatory for bankers, financial intermediaries, investment advisers, asset managers, trust companies, foreign exchange bureaus and life insurers to report suspicious dealings and block funds if necessary.
Despite the tighter rules, Del Ponte conceded that "until now, we have been unable to prevent the mafia from laundering money here".
Del Ponte, who has in the past cited the Russian mafia as one of the principal external threats to the security of the Swiss state and claimed that Russian criminals had stashed away $40 billion in Swiss banks, warned of mafia-related violence in the country.
"Wherever the mafia has a piggy bank, it is less interested in drawing attention to itself with acts of violence. But that situation could change quickly," she said. "Because first, the criminal money comes in to Switzerland and later, its owners follow."
A recent government report said that almost all of the world's organized crime syndicates had a Swiss base and were investing in property and other businesses in the country.
Del Ponte, who is expected to take up her U.N. war crimes tribunal post in The Hague on September 15, is likely to be replaced by her deputy Felix Baenziger, according to Swiss media reports. ((c) 1999 Reuters)