Ritualisation and money laundering in the Swiss banking sector
Banks and banking, Swiss
Switzerland, a landlocked country located to the west of Central Europe, is well-known as one of the world’s most competitive financial centres. It is also known as ‘the Swiss Confederation’ as it is a federal directorial republic. Federalism “describes the union of equal governing bodies, whose independence is to be preserved by their very union” (Coordinating Committee for the Presence of Switzerland Abroad, 1992). Although found in mainland Europe, Switzerland is not part of the European Union (EU). The objective of this article is to research the heavily debated topic of money laundering in the Swiss banking sector, not Switzerland’s political policies or the state of its economy. “Switzerland has steadfastly resisted efforts by the EU and the OECD to reduce, and preferably abolish, long-standing Swiss banking confidentiality rules” (Doggart, 2002). In this paper, we argue that it is the social environment surrounding an embedded group and the culture within this environment that play an important role in creating a cognitive script and taken-for-granted behaviours that allow the normalisation of money laundering activities crime within the Swiss banking sector. The main research question therefore is as follows: are Swiss banks offering a sanctuary for criminals who use their bank secrecy laws to hide the source of their illicit funds to elude authorities? In order to answer this question, we use HSBC as a prototype example of embedded ritualised money laundering practices in the Swiss banking sector. To provide a foundation to answer this question, the paper is anchored with the theory of structural ritualization. By anchoring the analysis with structural ritualization theory, our intention is to show that the patterns of behaviour and actions observed among the group embedded within the Swiss banking sectors are a product of the social structure within the larger environment.
This pre-print version is deposited under a Creative Commons Attribution-NonCommercial 2.5 Canada License. Permission has been granted by Emerald Publishing Ltd. for this version to appear here. If you wish to use this manuscript for commercial purposes, please contact firstname.lastname@example.org. The version of record is available at https://doi.org/10.1108/JMLC-04-2017-0013.