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The Abacha affair – both regrettable and encouraging

Money Laundering Bulletin

The Abacha affair – both regrettable and encouraging

In the past Switzerland has been a byword for convenient secrecy, a country in which bankers could be relied upon to accept funds without asking too many awkward questions about their provenance. However, recent scandals, including the use of Swiss accounts by Ferdinand Marcos of the Philippines to conceal stolen state funds, questions over the transfers from the Russian state airline, Aeroflot, into accounts controlled by a close ally of former President, Boris Yeltsin, and the international furore over the banks’ initial reluctance to co-operate with inquiries into the dormant accounts of Holocaust victims, has produced a fresh openness. The new readiness to investigate internal failings was given its fullest expression to date at the beginning of September when the Swiss Federal Banking Commission (SFBC) published its long-awaited report on the financial dealings of the entourage of Sani Abacha, the former President of Nigeria. Abacha came to power in a coup in November 1993 and died of a heart attack in June 1998. If Olusegun Obasanjo, the civilian president who succeeded him, is correct, during his short tenure he and his entourage plundered US$4 billion from the country’s reserves and sent most of the money offshore. In November 1999 the SFBC began to investigate 19 banks that had dealt with relations and associates of Abacha. It wanted to determine whether they had satisfied all mandatory due diligence, “know your customer” checks and complied fully with suspicious transaction reporting rules. By the Commission’s own admission it was an immense task which, at one time or another, occupied 12 people, 14 per cent of the total SFBC staff.

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