Ex-Banker, Swiss Businessman Guilty in Corporate Spying Scandal

Bookmark

A Swiss businessman was convicted of leaking company secrets to a former Lazard Ltd. banker and illegally profiting from the information, in a case closely watched by the country’s establishment.

Hans Ziegler was found guilty of two insider trading charges but acquitted on a third, the Swiss federal criminal court said in a ruling Tuesday. B., the ex-Lazard banker who cannot be named per Swiss reporting restrictions, was found guilty of both breaking corporate secrecy laws and commercial espionage.

Insider trading as a crime can carry a punishment of as much as three years in prison in Switzerland. However, it didn’t became one in the country until 1998 and prison terms are rare, with suspended sentences or fines being the norm.

Ziegler was also cleared of the charges of receiving bribes, given a two year suspended prison sentence, fined 10,000 Swiss francs ($10,890) and ordered to pay 110,000 francs in court costs.

While the banker was handed a 12-month sentence, suspended for two years, he was also fined 8,000 francs and must pay nearly 37,000 francs in court costs.

Hans Ziegler was found guilty of exploiting his role as a director of pump-making conglomerate Oerlikon Corp. and steel producer Schmolz & Bickenbach, two mainstays of Swiss industry, to feed commercially-sensitive information to the banker for over three years until he was found out in late 2016.

Ziegler used that information trade illegally in a range of household name Swiss stocks including retailer Charles Voegele Holding AG to travel agency Kuoni Reisen Holding AG. Neither of the companies are suspected of any wrongdoing.

As suspicions emerged over the course of 2016, federal prosecutors opened a probe into Ziegler, himself the former CEO of Swiss conglomerate Erb Group. In total, prosecutors found that Ziegler passed 19 valuable chunks of data on to B.

Ziegler, who was for a period a paid adviser to Lazard, allegedly disclosed secrets about a Swiss company being acquired by foreigners to B., and then demanded 150,000 Swiss francs for the information, prosecutors said in their indictment.

Ziegler resigned from the boards of Oerlikon and Schmolz & Bickenbach as the probe became known. Both companies declined to comment ahead of the trial. A spokesman for Lazard said B. was dismissed from the bank in 2017, declining to comment further.

Messages left for lawyers representing Ziegler and B. requesting comment weren’t immediately returned.

©2021 Bloomberg L.P.

BQ Install

Bloomberg Quint

Add BloombergQuint App to Home screen.