INTO THE FRAY: Helvetian Hypocrisy& Iran- A glimpse behind the “chocolate-box” image

By MARTIN SHERMAN

Photo by Clint McKoy on Unsplash

For decades, Swiss banks have served as a repository for funds linked to “rogue regimes”, dictators, and corrupt officials,

While the press coverage has been focused largely on the kinetic—and lately (since the closure of the Straits of Hormuz) on the sub-kinetic coercive—dimensions of the ongoing conflict in Iran, there is an additional aspect that usually avoids the full glare of media attention.

A repository for funds of “rogue regimes.”

This is the financial dimension—in particular, the banking sector, which often undergiths the ability of protagonists in a conflict to sustain their military operations—including payment of salaries to the military, acquisition of armaments, replenishment of ordinance, and so on. In this regard, Switzerland and its banking system hold a place of prominence. The Swiss banking sector is one of the most important in the world and is a central lynchpin of the Alpine nation’s economy.

Specifically for the purposes of this article, Switzerland holds roughly 25% of all global cross-border assets.

While all this speaks to the significance of the banking sector of the Swiss economy, there is a darker side to the picture. Indeed, historically, Swiss banks have served as a repository for funds linked to “rogue regimes”, dictators, and corrupt officials, something which, allegedly, continues in various forms, despite significant tightening of financial regulations in recent decades.

Clearly, today, with the conflict in Iran and its indisputably “rogue” regime, this steers attention to the relationship between Switzerland and the theocratic tyranny in Iran.:

Helvetian guardians of the riches of the tyrants

But picturesque Switzerland’s murky history with unsavory regimes is not a recent phenomenon. Indeed, it can be traced back as far as the mid-1700s. However, its international attraction began to emerge at the turn of the 20th century, when Swiss financiers became a magnet for foreign investors wishing to stash their increasingly mobile wealth in what was perceived as a politically neutral state.

By 1934, politicians enshrined banking secrecy – the “duty of absolute silence” – into law, making it a crime to share clients’ banking information, particularly with foreign authorities.

This, combined with Switzerland’s political neutrality, made the country a haven for Nazi officials. Swiss bankers collaborated heavily with Adolf Hitler and his regime, offering financial credit and assistance to fleeing Nazis to hide their ill-gotten riches.

In a blistering indictment of past Swiss international conduct, a veteran political journalist made the following assessment regarding Swiss machinations to conclude a deal for the purchase of gas from Iran, which many perceived as undermining the sanctions regime against Tehran, imposed because of its continued nuclear program. Caustically, she wrote: “Switzerland could no more have sold its principles than it could have sold its soul to the devil. For all its syrupy sanctimony, it has no principles – much less a soul. Switzerland is no rookie at playing footsie for profit with genocidal tyrants.”

Greed–gratification & banking “hanky-panky”.

To back up her acerbic portrayal, she catalogues how, during the Holocaust, Switzerland not only blocked the entry try of Jews fleeing persecution, but actually handed would-be refugees directly back over to their persecutors.

Pointing an accusatory finger, she laments: “…this means nothing less than collaboration in mass-murder [sic]. The Swiss turned away tens of thousands of Jews, sending them to certain, cruel death. Their blood indelibly stains Switzerland’s reputation.”

She resolutely exposes the blatant Swiss malice and hypocrisy, charging: “Without even touching on the business of banking hanky-panky and greed-gratifying benefits reaped by Switzerland from the incomparable Jewish tragedy, Switzerland did well for itself via exports of war materials to Hitler’s Germany, extending it credit, all manner of financial underpinning and loot-laundering services”. With scathing sarcasm, she laments “All this time, Switzerland gloried in resplendent neutrality,”

Indeed, it seems Switzerland has some difficulty in relinquishing its penchant for commercial contacts with brutal despots. Although Switzerland diluted its absolute bank secrecy significantly, high-profile leaks such as “Suisse Secrets” (2022) show that tainted funds—including those from sanctioned parties, war criminals, and human traffickers—have prevailed in the Swiss financial system. According to one seasoned commentator, such accusations are not new for Swiss banks, particularly when it comes to allegations relating to energy transactions or to attempts by Swiss banks to clean up their reputations for involvement with funds “redirected” from low-income countries, such as Haiti, the Philippines, the Democratic Republic of the Congo, and so on.

Falling afoul of US Treasury

Indeed, more recently, the Swiss banking system ran afoul of the US Treasury when its investigators found that one bank, MBaer Merchant Bank, had allegedly played a part in money-laundering activity related to Venezuela in 2020.

Moreover, according to investigators at the U.S. Treasury’s financial crime unit FinCEN, the bank allegedly then went on to enable financing of the Russian war machine and channeling Iranian oil funds back to the oppressive authoritarian regime—including to the Revolutionary Guard Corps.

This chronicle of dismaying Helvetian misfeasance is sadly not confined to the financial machinations of Swiss institutions. The same spineless display of hypocrisy and double standards extends to the conduct of the International Red Cross (ICRC), the flagship entity supposedly symbolizing Switzerland’s neutrality and humanitarianism, and whose statutes stipulate that its top echelons must be comprised exclusively of Swiss citizens. These were on stark display during the recent (2023-5) Gaza conflict, when the organization displayed deep concern for the population of Gaza (many of whom openly celebrated the abduction/abuse of unsuspecting Israeli civilians), but was totally useless in doing anything to ascertain the fate or the location of the Israeli hostages, never mind visiting them to determine their well-being under the “harsh” ( to greatly understate the case) conditions under which they were held.

Feigned “neutrality” behind picturesque chocolate-box image

Indeed, it is difficult to detect any effective ICRC measures to exert pressure on Hamas, certainly not—heaven forfend—raise the possibility of suspending aid to a largely complicit Gazan population until access to the Israeli hostages was granted—presenting this

equivalence for victims of aggression and those complicit (even if passively) in that aggression as its “neutrality

So, beneath the idyllic chocolate box images of a picturesque Alpine haven, there lurks a far more nefarious and avaricious reality, of which both Israel and the rest of the world should not obscure—or allow to be obscured.