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Compliance and Risk Management

We offer Services for Trustees and Trust Companies. For the first time, under the FinSA and FinIA acts, Trustees and Trust Companies are regulated in Switzerland. To be considered professionally active under FinIA, hence needing a licence to operate, a trustee must:

  1. Have gross income of greater than 50,000 CHF per year
  2. Maintain ongoing contractual business relationships with greater than 20 parties in a given year
  3. Have investment authority over third party assets amounting to 5 Million CHF at any time

If any one of these criteria are met, the trustee is covered and is prudentially regulated.

We believe that understanding the trust construct in its Anglo-Saxon context is essential to successfully working with Trustees. This means having professionals on hand trained in common law jurisdictions. We consider the elements of culture, history and common law inherent in how trust law and its application have developed over the centuries central to working with trustees.

Trustees face particular challenges in the changed environment. Operating, enforcing and administering an Anglo Saxon construct in a civil law jurisdiction is laden with challenges. Not least of which the trust structure being understood by regulators and local courts.

Services we provide to trustees are similar to asset managers and advisors, with some major differences due to the nature of the business:

Trustee registration and licensing

  • Support in FINMA registration and licence approval process
  • Preparation and filing of documentation

Trust company organisation

  • Set up internal organisation
  • Set up Internal Control Systems (ICS)
  • Ensure management from Switzerland
  • Training of personnel, client advisors
  • Identification, disclosure, deal with conflicts of interests, incl. publication of compensation paid to and received from third parties
  • Monitor service provider chain – outsourcing

Internal Control System (ICS)

  • Set up and maintenance
  • Segregation of functions and duties
  • Monitoring and reporting

Third party relations

  • Design and implement relations strategy and program; settlor, beneficiaries, protector, lawyers, asset managers, etc.
  • Advise on third party communication requirements
  • Identify and address issues and concerns among the various parties involved with and in a trust

Anti Money Laundering (AML)

  • Review account opening procedures, identity and source of funds checks, training, KYC checks, suspicious activity detection, investigation and reporting
  • Review and improve current AML program
  • Review and improve monitoring and reporting
  • Management and board of director reporting
  • Identify and respond to cross-border issues and requirements

Fiduciary duties

  • Advise on trustees fiduciary responsibilities
  • Support in  investment, administration, and distribution of trust assets
  • Disclosure duties to all parties involved

Internal Control System

For Trustees, having an effective Internal Control System (ICS) in place is one of the major changes under the Financial Services and Financial Institutions Acts. The ICS should be very similar to that for an asset manager, tailored to the needs of the trust business. The common requirement is that the organisation has control measures in place to monitor business processes and procedures. With a focus on achieving fiduciary objectives.

Under the FinSA and FinIA acts, trustees are required to have their internal control system verified by an external auditor. With the ICS aligned to the specific business needs and conditions of the firm. At a minimum, management must ensure that all processes related to financial reporting are documented and implemented in the ICS.

If you do not yet have an ICS or yours needs upgrading, we can help with meeting the internal organisational requirements as outlined under FINIA:

  • Organisational documentation
  • Management qualifications
  • Governance
  • Outsourcing