Swiss Banks Should Face More Finma Inspections, IMF Says
- IMF advisor Paul Mathieu rebukes Finma approach to regulation
- Mathieu say banks’ auditors may lead to conflict of interest
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Switzerland’s financial regulator should step up its on-site inspections of the country’s biggest banks, the International Monetary Fund said, in a rebuke to Finma’s approach to regulating the Swiss multi-trillion dollar financial industry.
The current practice of allowing banks to contract auditors for regulatory reviews creates potential conflicts of interest, given there are relatively few audit firms and they also provide consulting services to the banks, the Washington-based IMF also warned in its annual review of Swiss finance. The IMF also called on Finma to increase the independence of its governance framework.