A former top Swiss private banking executive turned WikiLeaks collaborator was rearrested on Wednesday night, hours after a court found him guilty of violating banking secrecy but did not sentence him to prison.
Zurich police said the latest arrest of Rudolph Elmer was for a new suspected violation of secrecy laws. Earlier this week, the ex-banker publicly handed disks over to WikiLeaks, the whistleblowing website, which he said contained data on private banks in Switzerland and their affluent clients.
The arrest came just hours after a Zurich court found Elmer, who once worked for Julius Baer Bank, guilty on separate charges of violating bank secrecy, attempted coercion and sending threatening letters to his former employer.
After he was fired in 2002, the court said the former executive illegally divulged information about Julius Baer customers and the bank, one of the country’s largest wealth managers.
But Elmer, who says he is a whistleblower, managed to avoid the jail-time prosecutors sought. Instead, he received a fine of some 7,200 Swiss francs (7,500 dollars), suspended for two years — a suspension thrown into question with the new arrest. He will also have to pay court fees.
Earlier this week Elmer said that in 2005 he was detained by Swiss authorities for 30 days, apparently in connection with his first violations of client confidentiality.
The one-time executive admitted in the Zurich courtroom to having revealed some information, but says he was aiming to expose wrongdoings by the financial sector regarding tax evasion assistance to wealthy international clients.
Elmer’s lawyers also argued that Switzerland’s strict secrecy laws, which regulate Julius Baer, did not apply in the Cayman Islands, where Elmer was based for eight years.
The Zurich-based wealth management group said that after it sacked the 55-year-old, Elmer tried to extort money and, when that failed, the “disgruntled” ex-employee made secret bank data public by handing it over to tax authorities.
Elmer counters that the firm offered him cash to keep quiet about its business practices.
In court, Elmer denied claims that he sent bomb threats, but admitted to dispatching anonymous threatening letters to bank staff.
At the time he sent the messages, he told the court, he was being followed by detectives hired by Julius Baer, causing intense psychological pressure. His daughter, the former banker related, was afraid to go to kindergarten during that period because of the men who tracked the family’s moves.
Zurich prosecutors were seeking a smaller fine, but had their eyes set on an eight-month jail term. They told a judge that Elmer was not a true whistleblower, a status that would offer him some protection.
Claiming he was seeking to expose wrongdoings was merely a “defence strategy,” Zurich’s prosecutors argued.
One report in a Swiss newspaper said the disks Elmer handed over to WikiLeaks founder Julian Assange in London on Monday has recent data on wealthy clients of private banks going up to 2009, years after the former banker was fired.
It was the second time he supplied banking information to the website, having first submitted data on Julius Baer in 2008, raising WikiLeaks’ profile internationally after the bank tried to shut down the site.
The trial comes at a critical juncture for the once-prized banking secrecy tradition. Banks in countries with confidentiality laws are facing heat, as more foreign governments, including Germany, are agreeing to pay money for stolen disks that contain information on tax-dodging clients.
In 2009, Bern agreed to relax its rules and allow more transparent international cooperation on tax matters.
That followed heavy pressure from the world’s top economies on so-called tax havens and a scandal in which UBS, the Swiss banking giant, was found to have aided wealthy U.S. clients evade paying their taxes.
The case forced UBS to hand over client data to the Internal Revenue Service, Washington’s taxman, which has since been clawing back unpaid dues from rich customers who hid their money abroad.
