Office of the Attorney General of Switzerland files indictment on charges of insider trading
Bern, 27.08.2020 - The Office of the Attorney General of Switzerland has filed an indictment against two accused on charges of betraying and/or exploiting trade secrets, industrial espionage and bribery of private individuals. One of these two accused also faces charges of exploiting insider information.
The Office of the Attorney General of Switzerland (OAG) has charged Hans Ziegler, one of the two accused, with multiple counts of betraying manufacturing or trade secrets (Art. 162 para. 1 Swiss Criminal Code [SCC] and Art. 6 in conjunction with Art. 23 Unfair Competition Act [UCA])*, multiple counts of aggravated industrial espionage (Art. 273 SCC), accepting bribes (Art. 322novies para. 1 SCC and Art. 4a para. 1 let. b in conjunction with Art. 23 UCA)* and multiple counts of exploiting insider information (former Art. 40 Stock Market Act / Art. 154 para. 1 Financial Market Infrastructure Act)*.
The OAG has charged the second accused with multiple counts of exploiting manufacturing or trade secrets (Art. 162 para. 2 SCC and Art. 6 in conjunction with Art. 23 UCA)*, multiple offences of industrial espionage (Art. 273 SCC) and with bribery (Art. 322octies SCC and Art. 4a para. 1 let. b in conjunction with Art. 23 UCA)*.
Alleged offences
The OAG opened criminal proceedings against Hans Ziegler in April 2016 based on a complaint from the Swiss Financial Market Supervisory Authority FINMA outlining suspicions of exploiting insider information. After detection of additional facts, the criminal proceedings were extended in July 2017 to include the second accused as well as the offences of breaching manufacturing or trade secrecy and the bribery of private individuals.
Following authorisation of the prosecution by the Federal Department of Justice and Police FDJP in May 2018, the OAG extended the proceedings against both accused to include the offence of industrial espionage. This offence involves the disclosure of a manufacturing or trade secret to, amongst others, a foreign private enterprise or its agents.
The OAG has filed the indictment because Hans Ziegler, as a member of the board of a company, between the end of 2013 and November 2016 on several occasions disclosed trade secrets to the second accused when he was not authorised to do so. This charge primarily relates to the sale of a foreign subsidiary to foreign potential buyer whose advisor was the second accused. The charge of accepting bribes is based on the allegation that after the sale was concluded, Hans Ziegler demanded the payment of CHF 150,000, which had been promised to him for disclosing the trade secrets. The payment was subsequently made to a company belonging to Hans Ziegler.
The indictment further alleges that Hans Ziegler, as a member of the board of four stock exchange listed companies and as senior adviser to two consulting companies, on several occasions exploited insider information in connection with commercial transactions involving securities from a total of eleven companies. As a result, he made a profit of almost CHF 2 million for himself and for two legal entities with which he is associated.
The OAG has filed an indictment against the second accused because on several occasions between the end of 2013 and November 2016 he exploited the trade secrets that Hans Ziegler had disclosed to him. The charge of industrial espionage is based on the allegation that he chose on multiple occasions to send secrets relating to two companies to other people abroad for their further use. The charge of bribery results from the fact that he promised Hans Ziegler the above-mentioned sum of CHF 150,000 for the trade secrets received and thereafter organised the payment of this sum.
Information in connection with bringing an indictment
The OAG will make its application at the hearing before the Federal Criminal Court (FCC). The accused are presumed innocent until they have been convicted in a legally binding judgment. With the filing of the indictment, the FCC becomes responsible for providing further information.
* Information on the offences charged:
Breach of manufacturing or trade secrecy: The betrayal and exploitation of trade secrets under Art. 162 SCC and Art. 4a para. 1 let. b in conjunction with Art. 23 UCA is only prosecuted in response to a criminal complaint from an aggrieved party.
Industrial espionage: The disclosure of a manufacturing or trade an external official agency, a foreign organisation, a private enterprise, or the agents of any of these under Art. 273 SCC is prosecuted ex officio and requires the authorisation of the Federal Council under Art. 66 para. 1 of the Criminal Justice Authorities Act.
Bribery of private individuals: Under Art. 4a para. 1 UCA in conjunction with Art. 23 UCA, the bribery of private individuals is prosecuted on complaint if the offence was committed before 1 July 2016. Offences committed after 1 July 2016 are prosecuted ex officio under Art. 322octies and 322novies SCC.
Exploiting insider information: For offences committed between 1 May 2013 and at the end of 2015, the legal basis is the former Art. 40 of the Stock Market Act; for offences committed from 1 January 2016, Art. 154 of the Financial Market Infrastructure Act forms the legal basis.
Address for enquiries
Communication Service of the Office of the Attorney General of Switzerland, info@ba.admin.ch
Publisher
Office of the Attorney General of Switzerland
http://www.ba.admin.ch/
