Members of the largest political party in the European parliament, the European People's Party (EPP), have called on the EU to review its relationship with Switzerland and consider placing the country on its financial “blacklist.” The move would mean Switzerland would join Myanmar, Syria and North Korea on a list of countries that have a high risk of financial crime.

Credit Suisse secrets scandal engulfs Swiss banks

The move comes amid a scandal at Credit Suisse which found that the Swiss bank allegedly held accounts for dictators and criminals. Credit Suisse has denied the allegations, saying that the majority of the cases listed are historical and that most of the offending accounts have been closed.

Member of the European Parliament for the EPP, Markus Ferber, called the revelations “unacceptable.” He said that the leak showed the "massive deficiencies of Swiss banks in the fight against money laundering," and called on the European Commission to clarify whether Switzerland should be classified as a “high-risk state” for financial crime.

As a coordinator of economic policy for the EPP, he cautioned that if the Swiss government doesn’t monitor its banking customers from high-risk areas, Switzerland will find itself blacklisted. If Switzerland is blacklisted, it would join other states like Myanmar, North Korea, and Syria.

Switzerland could be readmitted to the financial blacklist

This is not the first time Switzerland has been placed on the EU list, with the country being added in 2017 because of exceptionally low taxes on individuals and international companies that hold money in the country. Switzerland was removed from the list in 2019, after a referendum that introduced major reforms to Swiss taxation.

In response to the EPP, politicians within Switzerland have called for Switzerland's financial sector to be further reformed. The co-party leader of the Social Democratic Party of Switzerland, Cédric Wermuth, praised the Süddeutsche Zeitung for breaking the Credit Suisse story and said it was time for major reforms.

Swiss politicians call for reform to the banking system

He called the issues raised by the scandal “systemic” to the banking system in Switzerland. He demanded significant reform to the financial sector like lawyers and notaries being included in Switzerland's Money Laundering Act and a significant funding increase for the Money Laundering Reporting Office.

So far, the Federal Council has declined to comment on the revelations, saying they need more time to read the report in full. Some have also dismissed the claims, with National Councillor for FDP: The Liberals, Ruedi Noser, saying that no further action needs to be taken as 90 percent of the accounts revealed in the leak have been closed.