UBS has failed in its attempt to halt the appeal process concerning money laundering charges linked to the Bulgarian mafia, which is currently under review by the Swiss Federal Criminal Court in Bellinzona. The bank is now seeking to suspend the proceedings until the Federal Supreme Court reaches a final decision.
The «Bulgarian Connection» case is a legacy issue inherited from Credit Suisse (CS), which UBS is eager to resolve. In June 2022, the Tribunal Penal Federal in Bellinzona convicted CS, imposing a 2 million francs fine for failures in its client dealings with a criminal organization and lapses in enforcing anti-money laundering regulations.
At the beginning of the appeal process, UBS filed a motion for suspension, as reported by the «SDA» news agency on Tuesday. The bank argued that proceedings should be paused until the Federal Supreme Court has definitively ruled on its request to terminate the case.
UBS: No Legal Basis
One of UBS’s lawyers argued at the start of the trial that there was no legal basis for the transfer of liability. He reminded the court that the Swiss Federal Council had approved the acquisition of CS to safeguard Switzerland's financial sector. The case involves events that took place 17 years ago at a different bank under different leadership. UBS insists that the proceedings must be suspended until the Federal Supreme Court rules on its motion to dismiss the case.
Court Sees Legal Succession Through Merger Agreement
The Federal Criminal Court dismissed UBS’s argument in its September ruling, pointing to the merger agreement between the two major banks. The agreement entails not only the transfer of capital, premises, and personnel, but also CS’s legal standing in all court, arbitration, and administrative proceedings.
The case centers around the relationship between a former CS employee and the Bulgarian mafia, involving drug trafficking and money laundering. Both CS as a company and the ex-employee were found guilty. In addition to a fine, the court ordered the confiscation of assets worth more than 12 million francs, and CS was hit with a compensation claim exceeding 19 million francs for funds that were beyond reach.