How Swiss banks work?

Swiss bank is a common bank used in movies and the super villains or corrupt politicians have their accounts in Swiss banks. In the movie “Da Vinci Code,” a triangular-shaped key activates a robotic arm that pulls a safety deposit box from the wall in a Swiss bank in Paris to ultimately reveal the secret to Christianity. But nowadays Swiss banks are in highlight because of the enormous amount of black money deposited in the Swiss banks.

My curiosity is how these Swiss banks work? How they are able to hold so much black money and no one is able to stop them? I will try to answer these questions below.


First of all I want to clear that the all funny things you see in movies, actually never happens in a real Swiss bank. There is no robotic system and, while Swiss banks do have security, they don’t search their clients before letting them access accounts. Most of us have formed ideas about what Swiss bank accounts are and how they work based on scenes like these that we’ve seen in the movies, read in books, or maybe even heard in the news. In other words, most of us have a distorted or mostly unrealistic view of what it really means to have the prestigious Swiss bank account.

Swiss bank accounts aren’t just for millionaires, criminals or government officials trying to hide ill-gotten wealth, or celebrities protecting their assets from former spouses. They’re available to anyone and lots of average people have Swiss bank accounts. People who live in countries with unstable governments and banks in particular often turn to Swiss banks because of their security and privacy.

But let’s face it, most of us really just want to be able to say, “Oh, I’ll send you  the money from my Swiss bank account.


The major advantage of Swiss bank account is their privacy. Your relationship with your Swiss bank can be compared to doctor/patient confidentiality or the private information you might share with an attorney. Swiss law forbids bankers to disclose the existence of your account or any other information about it without your consent (except for certain circumstances, which we’ll discuss later). Where the similarity ends is when that privacy is violated. Whereas in the United States, if your doctor or attorney violates your confidence you must begin legal action; in Switzerland, if a banker divulges information about a bank account without permission, immediate prosecution is begun by the Swiss public attorney. Bankers face up to six months in prison and a fine of up to 50,000 Swiss francs. And, you have the option of suing the bank for damages. Needless to say, Swiss banks are very careful about protecting your privacy.

The only exceptions to the Swiss banking privacy rule are criminal activities such as drug trafficking, insider trading or organized crime.

So privacy is a big deal if you have money you don’t want other people to know about, and unless you’re a criminal it’s highly unlikely anyone can ever find out about your account. For example, doctors who might be sued for malpractice might have money in a Swiss account to prevent them being totally wiped out in the event of lawsuit. Unethical, yes, but it happens. Really, anyone can have assets that they want to protect from attack. Sometimes, though, privacy isn’t the main reason people want a Swiss bank account. Switzerland has had an extremely stable economy and infrastructure for many years and hasn’t been at war with another country since 1505. Swiss bankers are also highly trained in investing and know how to grow your money.

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Increasing your wealth means little if your money isn’t protected. So, how safe is your money in a Swiss bank? Depositor protection in Switzerland is governed by the Swiss Bankers Association’s (SBA) self-regulatory Depositor Protection Agreement and, since July 1, 2004, was also codified into the Swiss Banking Act with a few additional requirements that significantly strengthened depositor protection in Switzerland. The revised Depositors’ Protection Agreement covers all deposits and is also applicable to non-bank securities dealers. Protecting depositors is vital in maintaining public confidence in the Swiss banking system and, in order to strengthen this confidence, the SBA had drawn up a self-regulatory Depositor Protection Agreement with its member banks in 1984. This agreement guarantees that, in the event of a bank failure, depositors will rapidly receive their legally privileged claims. As an additional safety measure, Swiss law demands high capital adequacy. Swiss banks can therefore certainly be counted amongst the safest in the world.

In fact, the Swiss franc is considered one of the world’s premier currencies with virtually zero inflation and has been historically backed by at least 40 percent gold reserves. Swiss banks are also known to have very sophisticated investment services and Internet banking.

But why the Swiss banks are not accountable internationally?


Switzerland is required to assist the authorities of foreign states in criminal matters as a result of the 1983 federal law relating to International Mutual Assistance in Criminal Matters. Assets can be frozen and handed over to the foreign authorities concerned. Assistance in criminal matters follows the principles of dual criminality, specialty and proportionality.

Dual criminality means that Swiss courts don’t lift the requirement of bank/client confidentiality unless the act being investigated by the court is punishable under the law in both Switzerland and the country requesting the information. The specialty rule means that information obtained through the arrangement can only be used for the criminal proceedings for which the assistance is provided. The proportionality rule means the measures taken in conducting the request for assistance must be proportionate to the crime.

Do you want to open a Swiss bank account? Not a problem, see below.

According to Swiss law, nonresidents of Switzerland who would like to open a Swiss bank account must be at least 18 years old. Other than that, there aren’t a lot of restrictions. Your account can be in almost any currency, although most choose the Swiss franc, U.S. dollar, Euro or Sterling, and there is often no minimum balance required to open an account. Once you’ve started making deposits, however, there is a minimum balance you have to maintain that varies from bank to bank and by type of account.

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The Swiss bank you choose to deal with depends on what types of investments you want to make and the type of account you want have. One thing to keep in mind is unless you don’t care about the privacy aspect of a Swiss bank account, you shouldn’t choose a bank that has a branch in your country. Bank branches have to follow the laws in the countries in which they’re located — not where the corporate bank office is located. For example, a Swiss bank branch in the United States has no greater privacy capabilities than a regular U.S. bank does.


The type of account you open depends on the number of investments you want to have access to and the amount of money you want to maintain in the account. The more extensive the investment services and options are, the higher the required balance for the account. You can also have access to a safe deposit box at a Swiss bank.

If you maintain your account in Swiss Francs you will earn a small amount of interest, but will then have to pay the Swiss withholding tax. For this reason, most account holders that don’t live in Switzerland have their Swiss bank account in some other currency such as U.S. Dollar, British Pound or Euro. When you do this, your money can be put into a money market fund and will earn interest there.

While it’s usually better to open your account in person, there are many Swiss banks that will allow you to open an account by mail or fax. There are also many firms that exist to assist people in setting up offshore accounts.

Because Swiss anti-money-laundering law requires you prove where your money is coming from, many certified documents are required in order to open an account. These include authenticated copies of your passport; documents explaining what you do for a living such as tax returns, company documents, professional licenses, etc.; proof of where the money you are depositing is coming from such as a contract from the sale of a business or house; and all of the typical personal information about yourself such as your birth date, a utility bill to prove your residence, all contact information, and, of course, your name. They’ll also want to know what you want to do with the money once you have the account.

If you’re opening your account by mail, you’ll need to have the bank applications sent to you to complete and sign along with the rest of the documents mentioned above.

One difference between opening an account in person and doing it by mail is the requirement of an apostille on the authenticated copy of your passport (and no, a driver’s license won’t be accepted as proof of your identity).

An apostille is a seal used to certify that an official document is an authentic copy. In most countries, you can get it from a notary public but sometimes notaries aren’t familiar with them. If this happens you must either find another notary who is, or find out what other authority in your country can issue apostilles. Any country that participated in the Hague Convention designates an authority that can issue apostilles (e.g., in the United States, the office of the state’s secretary is authorized to do this). The most important thing is to always make sure the seal says APOSTILLES.

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Want to open a numbered account like we see in movies?

Numbered accounts are usually not as easy to open. They typically require that you physically go to the bank in Switzerland. They also typically require an initial deposit of at least $100,000 and cost about $300 per year or more to maintain. And remember, they’re still not anonymous since there has to be a connection at some level between who you actually are and your account.

Accessing Your Money

  • Credit card: Most Swiss banks will issue a credit card with your account that you can use to make purchases, as well as withdrawals at ATMs around the world. Cash advances, however, will charge a fee (usually 2.5 percent). Use of a credit card can also be traced back to your Swiss bank revealing the fact that you have the account. These credit cards are issued differently from typical credit cards, however. Rather than pulling a credit report and actually issuing true credit, Swiss banks require that you make a security deposit that is 1 to 2 times your monthly credit limit depending on the type of account you have. The security deposit itself is held in a separate account and invested.
  • Cash withdrawals: If you’re in Switzerland you can walk into your bank and make a direct cash withdrawal, leaving no record of the access.
  • Travelers’ checks: Buying travelers’ checks is one way of using the money from your Swiss account and maintaining your secrecy. They’re easy to use and widely accepted, but you will have to pay a 1 percent commission on the amount of the check.
  • Bank transfers: A simple way to use the money in your Swiss bank account is to request a bank transfer. But, again, you’re essentially revealing the existence of your account, as well as your account number. To prevent revealing your account number and name, most Swiss banks will send money from your account in the bank’s name without releasing your identity, but sometimes those types of transfers aren’t accepted outside of Switzerland.
  • Checks: Swiss bank accounts do offer checking (except on numbered accounts). However, if you’re after privacy, you’re leaving a trail of breadcrumbs directly back to you. You lose the confidentiality most people want with a Swiss account and, therefore, checks are rarely used with these accounts.


Recently black money has been a big issue in India and government is trying to get the names of people who have black money in Swiss bank accounts. I hope they will achieve their goal.

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Harsh is a curious writer who loves to explore his surroundings. There are many websites who provide answer to people queries but no single website alone resolves the curiosity of people. Curious Mind Box is an initiative to resolve the curiosities and answer every What, How and Why question that comes into your mind.

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