IT revolution a ‘bane’ for Swiss banking secrecy

 GENEVA: The digital revolution is turning into the Achilles heel of Swiss banks, according to security and banking experts quizzed about recent stolen data turning up in the hands of neighbouring countries.

CD-ROMs, USB sticks and even mobile phone cameras have become handy options for disgruntled or ambitious staff to copy computer data on thousands of clients when a few years ago a cumbersome paper trail was needed. Swiss banks built much of their reputation around a legal obligation to maintain secrecy on their customers’ banking affairs — criminal cases aside — including from the taxman, whether in Switzerland or abroad.

But preventing one-off leaks, which can have much a bigger scope than before, is becoming a conundrum. Banks are “big consumers of information technology” and have to “square the circle” to counter the threat, Gregoire Ribordy, director of network security firm IDQuantique said.

Measures are available, such as minimising the extent of information open to client advisers, automatic access restrictions, or prohibiting USB keys and CD-ROMs at the workplace. Nonetheless, “information has to circulate so that people can do their jobs,” said Ribordy. Yet, even a miniature camera on a cellphone is enough to take a snapshot of data displayed on a computer screen, he pointed out.

The 1934 law on bank secrecy was specifically designed to discourage staff from leaking client data to foreign powers by making it a criminal offence, but that was in the era of hand or type-written ledgers and punch cards. Last week, German authorities said they were ready to pay2.5 million euros for a CD-ROM with stolen Swiss bank data in a crackdown on tax-dodging taxpayers.

A spokesman for the Swiss Bankers Association, Thomas Sutter, acknowledged that the case “is not a good thing for the financial centre”.

AFP, 15 February 2010, 12:22am IST

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