Persistent AML risk analysis shortfall among Swiss banks, FINMA reveals

In response to the findings, the Swiss regulator has published guidance to enhance risk practices.

Many Swiss banks are falling short in their money-laundering risk analysis, new findings from The Swiss Financial Market Supervisory Authority, FINMA, show.

During spring 2023, FINMA found repeated shortcomings around the money-laundering risk analysis during on-site supervisory reviews at over 30 banks. “A large number of the risk analyses examined did not meet the basic requirements for such an analysis,” FINMA said.

Some of the findings included deficiencies in setting limits to reduce risks, and not having required structural elements to provide an effective and robust risk analysis.

“In order to understand the impact the risk-mitigating measures (control risk) have on the inherent risks, they must be described in sufficient detail,” FINMA continued. “However, the description of the risk-mitigating measures taken by the institutions were regularly too generic to comprehend their impact on the inherent risks.”

“A large number of the risk analyses examined did not meet the basic requirements for such an analysis.”


According to Article 8 of the Swiss Anti-Money Laundering Act, banks must take the required measures to prevent money laundering and terrorist financing in their type of business. One of the required measurements is to preparate a risk analysis in accordance with Article 25 para. 2 AMLO-FINMA.

FIMNA has published new guidance to create transparency about its observations and experiences gained from supervisory practice in this field.

Strengthen AML and CTF framework

Following the report, the Swiss Federal Council also announced plans to strengthen Switzerland’s anti-money-laundering and counter-terrorism financing framework, and has opened a consultation on a bill drafted to:

  • introduce a federal register of companies and their beneficial owners – it will be non-public, and managed by the Federal Department of Justice and Police;
  • broaden due diligence requirements to involve certain consultancy activities like legal advice;
  • other measures include preventing sanctions evasion, lower cash payment thresholds for precious metals trading CHF100,000 to CHF15,000 ($112,640– $16,896), and requiring due diligence for cash payments in real estate.

“The aim is to reinforce the integrity and competitiveness of Switzerland as a financial and business location with a federal register of beneficial owners, due diligence for particularly risky activities in legal professions, as well as other provisions,” the Federal Council said.

The consultation will last until November 29, 2023.

The money-laundering risk analysis

The money-laundering risk analysis is a tool for the strategic management of banks and other financial intermediaries to identify and mitigate the risks in the area of money laundering and determine the relevant risk criteria for the financial institution’s activities. It also stipulates which money-laundering risks are not within the institution’s risk tolerance.

Source: FINMA