Busting the Myths: Separate Fact from Fiction on Freezing Swiss Bank Accounts

For many years, the perception of investors and wealthy individuals was that Swiss banks were the most trustworthy and secure in the world. This belief was grounded in the Swiss banking secrecy laws. The latter gave foreign clients a sense of assurance when it came to safeguarding their wealth, even in the face of sanctions.

In recent years, things have taken a dramatic turn. The adoption of automatic information exchange policies and the introduction of the 9th round of US sanctions against Russia have considerably reshaped the landscape. The possibility of Swiss banks freezing Swiss bank accounts is no longer a fanciful notion. Even the largest private clients and corporations are becoming increasingly concerned about protecting their financial assets.

Where is the safest place to open an overseas bank account to avoid the risk of freezing and blocking? Each case is unique and requires careful analysis. Many still believe Swiss banks to be the safest and most reliable place to store their capital. However, for some individuals, it may be better to consider transferring their businesses and assets to offshore accounts or using trusts to ensure capital safety.

Can you trust Swiss banks with your money today?

Although following a series of scandals one of the major financial giants in Switzerland was acquired by another (Credit Suisse by UBS), the country’s banking sector reliability is still high. 

While for those on the sanctions list the era of security and confidentiality has ended due to the implementation of global standards on beneficiary information disclosure and information exchange, the reliability of the Swiss banking sector remains unchanged for law-abiding citizens and foreign companies. 

While the law on banking secrecy is still intact, Switzerland has introduced more stringent regulations for opening bank accounts in recent years. The coverage amount for risks of bankruptcy and force majeure is still up to CHF 100,000, yet the rigorous compliance measures implemented by financial institutions can make opening a Swiss bank account more complex. Financial giants are committed to upholding their reputations and adhering to global regulatory standards, while also maintaining their domestic ones. As a result, customer verification procedures for Swiss bank account holders are now more thorough.

Go ahead and learn more about the top Swiss banks in 2023.

Are Swiss banks known to freeze the accounts of non-Swiss nationals?

Similar to financial institutions across the globe, Swiss banks have the authority to freeze assets and Swiss bank accounts of their clients for a multitude of reasons. The latter go beyond the directives of bankers or the mandates of international organizations.

Here’s what we mean:

• Following the 9th round of sanctions that Western countries implemented against certain Russian residents, Swiss banks have commenced account-freezing procedures for individuals on the sanctions list. It’s important to highlight that the freezing of Swiss bank accounts only applies to individuals listed within the sanctions package and not to all Russian accounts.
• Under their internal policies, Swiss bankers have the power to freeze a Swiss bank account if there is any breach in the disclosure or updating of information, or if financial transactions are made with individuals on the same sanctions list. Every transaction is scrutinized and verified, and the bank has the right to demand confirmation of any info concerning transfers to and from the Swiss bank account. 
• In Switzerland, account freezing may occur if there is evidence of money laundering and/or terrorism financing. These regulations have been introduced by the FATF and are in effect not only in Switzerland but in many countries worldwide.

Identifying Swiss banks that still uphold banking secrecy

In force since 1934, the Swiss law on banking secrecy is still effective today. While it is true that Switzerland exchanges information with tax authorities from other countries, provides information on beneficiaries when requested by certain regulatory bodies, and may freeze accounts if there is evidence of the account holder’s illegal activities, these are global norms. They are not unique to Switzerland. Failure to comply with these norms can lead to a damaged reputation for the bank and expose it to the risk of collapse due to multiple unreliable clients, criminal activities, and financial manipulations.

FYI: Swiss banks do not protect you from tax liabilities and neither do they give you absolute confidentiality. However, they do not disclose information to anyone who requests it and only do so under the established legislative norms, including their home laws.

When a foreign client opens an account with a Swiss bank, they can be confident that their money is safeguarded by some of the most secure financial institutions in the world. The bank may only disclose the information if foreign intelligence agencies can prove tax evasion or other illicit financial activities. This provides clients with a sense of security and privacy unmatched by most other financial institutions. 

Swiss banking made simple: how can I remotely set up a bank account in Switzerland in a secure way?

Not every financial institution in Switzerland or other countries is willing to remotely open accounts for non-residents. Usually, personal presence is required to at least sign an agreement for financial services and account opening. Nevertheless, if you turn to the Q Wealth specialists for help, the issue can be tackled.

Here’s what you will need to do to achieve this:

• get in touch with the Q Wealth team using the contact details on our website
• pay for the services of the Q Wealth professionals
• submit the necessary documents as requested
• complete all identification and other procedures assisted by the Q Wealth experts
• gain access to your very own Swiss bank account.

We’re here to answer any questions you may have, and we’re always happy to respond during our standard business hours. If you need to get in touch with the Q Wealth consultants, don’t hesitate to drop us a line at in**@***********rt.com. We look forward to hearing from you!