The Swiss Financial Market Supervisory Authority (FINMA) is Switzerland’s top financial regulator, charged with licensing, supervising, and enforcing regulation over banking institutions, securities firms, insurance companies, asset managers, and other financial intermediaries. While FINMA’s remit spans prudential supervision, market conduct, and insolvency oversight, it also plays a critical role in ensuring that Swiss financial institutions comply with anti-money laundering (AML) and counter-terrorist financing (CTF) obligations under Switzerland’s legal framework.
FINMA operates as an independent authority, accountable to the Swiss Federal Government and Parliament, with authority to issue binding regulations, conduct inspections, require remedial actions, and impose sanctions. It enforces both the Anti-Money Laundering Act (AMLA) and its implementing ordinances, including the FINMA Anti-Money Laundering Ordinance (AMLO-FINMA).
Legal Basis & Regulatory Framework
FINMA’s AML oversight is grounded in Switzerland’s Anti-Money Laundering Act (AMLA) and accompanying Anti-Money Laundering Ordinance, as well as the FINMA Anti-Money Laundering Ordinance (AMLO-FINMA), which provides detailed rules for financial intermediaries.
Under this framework, all financial intermediaries must implement due diligence, risk assessment, transaction monitoring, and reporting obligations. FINMA uses both direct supervision for licensed institutions (banks, securities firms) and oversight of Self-Regulatory Organisations (SROs) or Supervisory Organisations (SOs) (for non-bank intermediaries) to ensure compliance across the financial sector.
FINMA also issues circulars, regulatory guidance, and interpretive rules that flesh out expectations around AML/CTF practices in Switzerland.
Scope & Supervision Under FINMA
FINMA’s supervision of AML/CTF is multi-dimensional: it applies direct oversight of banks and securities firms, indirect oversight via SROs/SOs for non-bank intermediaries, and special focus on evolving sectors such as crypto and fintech.
Banking, Securities & Prudential Entities
Licensed banks and securities firms in Switzerland fall under FINMA’s direct supervision. As part of prudential supervision, FINMA ensures these institutions also comply with AML/CTF obligations, for example, that their internal controls, governance, audit, and reporting programs are adequate.
FINMA uses a risk-based supervisory approach, meaning institutions with higher systemic or money laundering risk receive more intensive review. External audit firms may assist FINMA in compliance audits.
Non-Bank Intermediaries, SROs & Supervisory Organisations
Many financial intermediaries (e.g. fiduciaries, trustees, smaller asset managers, crypto service providers) are not directly supervised by FINMA. Instead, they must affiliate with SROs recognized by FINMA. Those SROs enforce AML rules among their members, conduct oversight, audits, and escalate serious breaches to FINMA when needed.
In addition, since 1 January 2022, some asset managers and trustees operate under SO (Supervisory Organisations) created by the industry, monitored by FINMA.
FINMA recognizes SROs/SOs that meet criteria: robust regulation, audit capacity, disciplinary powers, and independence. It supervises these organizations to ensure they enforce AML standards consistently.
Crypto & Emerging Risk Areas
FINMA has increasingly focused on crypto / virtual asset service providers. In recent AML supervisory activity, FINMA has published expectations about the “Travel Rule” in blockchain payments, wallet attribution, and risk treatment for crypto transactions.
During 2022, FINMA conducted reviews of crypto service offerings by supervised institutions and SROs, assessing their adherence to AML obligations and advising on compliance gaps.
Key AML/CTF Expectations & Tools
FINMA expects all financial institutions under its supervision to maintain robust AML/CTF programs tailored to risk. These expectations cover due diligence, transaction monitoring, internal controls, audit, and reporting functions.
Institutions must implement risk assessments to identify vulnerabilities in clients, geographic exposure, products, and delivery channels. FINMA has flagged deficiencies in how institutions handle complex ownership structures or third-party entities.
Due diligence (customer screening, identity verification, beneficial ownership tracing) must be applied not only on onboarding, but continuously over the customer relationship, with enhanced measures for high-risk clients. The Swiss AML framework also requires internal directives, staff training, and audit testing.
FINMA also expects high quality suspicious transaction reporting to the Swiss FIU (Money Laundering Reporting Office Switzerland, MROS). Weak or incomplete reporting has been a point of supervisory attention.
The FINMA Anti-Money Laundering Ordinance (AMLO-FINMA) prescribes how intermediaries must implement obligations, such as internal controls, documentation rules, and escalation paths.
Enforcement, Inspection & Remediation
When FINMA detects non-compliance, it can impose corrective measures, require remediation, issue warnings, or take other enforcement actions permitted under Swiss law. Its approach is to maintain financial stability, market trust, and investor protection.
FINMA conducts on-site inspections, audits, and reviews, either directly or via audit firms, especially in high-risk areas or when prior issues have been flagged.
For serious violations or systemic lapses, FINMA can impose sanctions, including fines, license restrictions or revocation, or public enforcement actions. It also monitors the SROs and SOs’ discipline mechanisms and intervenes when they fail to control their members effectively.
FINMA’s annual reports show that it targets weaknesses in risk analyses and corporate structure handling, pushing institutions to improve both governance and reporting quality.
Why FINMA Matters In AML/CTF
Switzerland is a major global financial hub with strong cross-border capital flows, private banking, and wealth management. As such, FINMA’s role in enforcing AML/CTF standards is critical to protecting the integrity and reputation of the Swiss financial center.
By supervising both global banks and smaller financial intermediaries, FINMA helps ensure that Swiss institutions cannot become safe havens for illicit flows. Its oversight of SROs ensures even institutions outside the direct regulatory perimeter comply with standards.
In recent years, FINMA has increased scrutiny over crypto, complex ownership, and deficient reporting. These priorities signal where Swiss AML trends and expectations are evolving.
FINMA’s role also supports international cooperation: its enforcement or supervisory actions send signals to foreign regulators, and Swiss institutions often must align with both Swiss law and global AML norms (FATF, EU counterparties).
Strengthen Your Compliance Under Swiss AML Expectations
Institutions operating in Switzerland or with Swiss counterparties must ensure their compliance systems can satisfy FINMA’s expectations. That includes rigorous risk assessment, continuous screening, reporting frameworks, and readiness for inspections.
Deploying robust Watchlist Management, Customer Screening, and Transaction Monitoring solutions helps institutions generate high-quality alerts and reports that align with FINMA’s supervisory standards.
Contact Us Today To Strengthen Your Swiss AML Compliance Framework
