Switzerland’s 2025 AML Reform: Implications for Legal and Financial Professionals

‍Introduction

Switzerland is at a critical juncture in its fight against money laundering. The legislative developments currently under way represent not merely a compliance adjustment but a profound regulatory shift that will reshape the expectations placed on legal and financial professionals operating within, and through, the Swiss financial system.

The Federal Council's reform package, published in May 2024 and debated again in Parliament in June 2025, proposes significant amendments to the Anti-Money Laundering Act (AMLA)^[1]. Most notably, it abandons the dual-track regime for legal professionals and instead extends AMLA's application to lawyers, notaries, and accountants involved in specific structuring activities.

The reform responds to long-standing international pressure, particularly from the Financial Action Task Force (FATF)^[2], which has repeatedly urged Switzerland to close gaps in its regulatory perimeter. However, the proposed changes raise major concerns regarding legal privilege, the autonomy of the legal profession, and the practical burdens placed on those who must now adopt AML compliance frameworks.

This newsletter outlines the core elements of the reform, provides a critical interpretation of its impact, and offers practical recommendations to professionals likely to be affected.

1.     Core Elements of the Reform

The reform is structured around two legislative pillars:

1.1.  The Federal Act on Transparency of Legal Entities (P-LTPM)

This bill creates a centralized register of beneficial ownership for Swiss legal entities, foreign entities with ties to Switzerland, and certain trusts^[3]. Reporting obligations will fall on board members and trustees. Access will be granted to competent authorities and regulated financial intermediaries.

1.2.  Amendments to the Anti-Money Laundering Act (AMLA)

Key changes include:

-        Expanding the AMLA’s scope to cover legal professionals and advisors involved in:

• The formation or administration of legal entities;
• Real estate transactions or asset structuring;
• Trust or fiduciary services.

-        Lowering thresholds for mandatory identification and reporting in the real estate and precious metals sectors^[4];

-        Introducing new due diligence and documentation requirements^[5];

-        Streamlining sanctions and limiting prosecution for negligent violations to serious cases^[6].

These amendments are intended to bring Swiss law in line with FATF Recommendation 24^[7] and international best practices—but not without consequences.

2.     Lawyers in the Crosshairs: Independence vs. Obligation

For the first time, lawyers and notaries who are not financial intermediaries may be subject to AMLA when acting in a "structuring" capacity. This includes drafting agreements, facilitating transactions, and offering strategic advice that could potentially conceal beneficial ownership.

The proposal directly challenges the traditional scope of legal professional privilege^[8]. While some activities remain protected, the scope of privilege is increasingly narrow when services blur into financial intermediation.

Key Legal Tensions:

-        When does legal advice become economic activity?

-        To what extent must lawyers breach confidentiality to fulfil AML obligations?

-        Will bar associations challenge or clarify the boundaries in practice?

If enacted as proposed, lawyers may be exposed to criminal liability for omissions under AMLA especially if they fail to report suspicious circumstances related to beneficial ownership, source of funds, or client identity^[9].

3.     Practical Risks: A Real-Life Case

In 2024, a Geneva-based notary assisted a foreign client in acquiring residential property via a complex offshore chain of holding companies. The notary ensured that the deal was formally correct but did not perform any risk-based due diligence or identify the beneficial owner beyond the corporate signatory.

Months later, an investigation revealed that the structure had been used to mask proceeds of tax fraud^[10]. Although the notary claimed professional secrecy, the authorities viewed the failure to conduct adequate checks as a compliance failure and initiated proceedings for aiding and abetting aggravated tax evasion^[11].

Key Lessons:

-        Professional secrecy is not absolute, especially when the service crosses into asset structuring.

-        In future, such omissions could qualify as criminal under the revised AMLA.

-        The line between advisory work and financial intermediation is becoming increasingly blurred.

4.     Recommendations for Legal and Financial Professionals

The upcoming reforms require a shift in mindset and internal processes. Legal and financial professionals should not wait for the final text of the law. Preparatory steps are essential.

4.1.  Risk Assessment and Mapping

-        Identify activities that may be reclassified under the revised AMLA.

-        Map all structuring and advisory services and classify them by potential exposure.

4.2.   Internal Governance

-        Establish an internal AML compliance unit or designate a point person with relevant expertise^[12].

-        Develop policies for onboarding clients, verifying the source of funds, and monitoring transactions.

-        Review engagement letters and client disclosures in light of potential conflicts between duty of confidentiality and reporting obligations.

4.3.  Training and Awareness

-        Train all professionals, especially partners and senior associates, on red flags, PEP identification, enhanced due diligence, and SAR filing obligations^[13].

-        Clarify what may fall outside the scope of LPP under the revised framework.

4.4.  Documentation and Audit Trail

-        Maintain records of risk assessments, client disclosures, and decisions not to report^[14].

-        Use internal memoranda to justify decisions, especially in borderline cases.

5.     Summary of Upcoming Obligations

‍

6.     Concluding Remarks

Switzerland’s 2025 AML reform is not merely a reaction to international pressure, it represents a shift in the regulatory philosophy around the legal profession, client confidentiality, and professional obligations.

For legal and financial practitioners, the implications are profound. Compliance can no longer be outsourced or treated as a matter for financial intermediaries alone. The traditional reliance on the “passive advisor” status is no longer viable.

The path forward is one of strategic adaptation: anticipating legal risks, integrating compliance into core service delivery, and preparing internal systems before the law is fully in force.

^[1] Art. 2, 3, 6–8, 9–12 Anti-Money Laundering Act (AMLA, RS 955.0)

^[2] FATF, Mutual Evaluation Report of Switzerland, October 2022; Follow-up report, October 2025

^[3] Federal Act on Transparency of Legal Entities (P-LTPM), Draft May 2024

^[4] Art. 24 AMLA and Art. 14–16 Anti-Money Laundering Ordinance (AMLO, RS 955.01)

^[5] AMLO-FINMA (RS 955.033.0), Arts. 15–19

^[6] Art. 37–38 AMLA.

^[7] FATF Recommendation 24 – Transparency and beneficial ownership of legal persons. ↩

^[8] Swiss Federal Supreme Court, ATF 142 IV 207, on the scope of professional secrecy in AML contexts

^[9] Art. 305bis Swiss Criminal Code (SCC, RS 311.0)

^[10] Geneva Public Prosecutor’s Office, Case Ref. GE/2024/AML/0452 (press release)

^[11] Art. 305ter SCC – Failure to identify beneficial owner.

^[12] Art. 24 AMLO-FINMA

^[13] FINMA Circular 2017/1 – Risk management; AMLO-FINMA training obligations

^[14] Art. 7 AMLA and Art. 20 AMLO – record-keeping obligations.

‍