The Federal Act on Money Laundering which came into force in 1998 places several obligations of due diligence (that is, identification of the contracting party, verification of beneficial owner, clarification of suspicious transactions and so on) on financial intermediaries. It applies to all financial intermediaries whether those already supervised by special legislation (such as the banking sector) or those in the non-banking sector, which were in 1998 not yet subject to any special supervision. In the non-banking sector the Act applies to all persons who, on a professional basis, accept, hold in deposit or assist in the investment or transfer of assets belonging to third parties.
The Money Laundering Control Authority has now issued a new Ordinance which defines the criteria under which an activity of a financial intermediary in the non-banking sector is considered to be "on a professional basis". At the same time the new Ordinance aims at excluding certain minor financial activities from the scope of the Act.
In order to define the term "on a professional basis" the Ordinance enumerates several alternative criteria, that is, the fulfilment of one criteria is usually sufficient that the exercise of such an activity is considered to be on a "professional basis" and therefore falls within the scope of the Act. In order to define this term, the Ordinance enumerates criteria such as a minimum income per calendar year (such as Sfr20,000, $30,300) resulting from an activity as financial intermediary or the right of disposal over assets of more than Sfr5 million belonging to third parties within the framework of continuing business relationships. Among the criteria mentioned are also the entering of business relationships as a financial intermediary with more than 10 contracting parties or the offering of money exchange as an additional service (that is, in hotels) above Sfr5,000 per transaction. The criteria mentioned in this Ordinance are strict in order to avoid loopholes in the prevention and combating of money laundering in Switzerland.