Many swiss banks have started to require that all employees use the company’s banking services exclusively. There seem to be some people interested in discussing the legality and consequences thereof.
Reminder: Please do not discuss illegal practices. They are not welcome in this forum.
The employers often point to FINMA regulations. But to my knowledge FINMA only requires that banks take steps to prevent insider trading. The implemented compliance solution is their own.
One example among others is Art. 323b Abs. 3 OR also known as “Truckverbot” (ban on truck systems) which voids agreements that use salaries to the benefit of the employer.
The author examines the balancing of interests and comes to the conclusion that the employees interests could prevail in certain cases. For example if you are forced to use investment services due to the size of your wealth.
Since it’s already 2023 there could be court cases. But I’m no lawyer, so I’m not familiar with searching for such information.
Also the possibility of your employer wanting to get rid of “difficult” employees is another thing to consider.
The employer can force the employees to close any other broker account and only use the one provided by the bank, that probably has some additional constraints on the orders to avoid insider trading
AFAIK they don’t actively track the employees investment activities but rather to have access to the full history of the account. If there is an investigation I guess it would be easier for a bank to access their own systems audit logs and trading history etc. than having to rely on some other broker to fully transmit all the documents.
The point is, the Bank requests that all trading has to be done via their platform, they can monitor inside trading and act accordningly.
If one does this via a 3rd party they can no longer monitor it and you are to be blamed.
This is basically just done so that they are not at fault here, since the moment you use another brooker you re at fault anyway.
However, if they allow their employees to use 3rd party broker, you’ll have to announce it to your employer’s compliance team.
Each compliance departement will have a control in place (annual review, random check etc) and will most likely ask you to provide them with a list of your transactions.
All these questions can be raised/discussed with HR during the recruiting process.
We are advanced but not that advanced that banks would have APIs to share information with other banks about employee trading . As pointed out by others this is usually done in a fixed recurring timeframe where you have to manually fill out a form to the compliance team about tradings.
If it’s that big of a problem to you there are financial institutions (like cantonal banks) which have no trading or broker restrictions at all. You just have to announce where you have an account but nothing more.
If you mean changing the job to a less restrictive employer…I am considering…especially if one wants to create trading and/or investment positions, which shouldnt be sucked up by fees…
I can’t say that it doesn’t exist for 100% but I don’t know of any automatic data exchange of employee tradings between banks or brokers. Also the effort would be huge to maintain these APIs to all the other brokers and banks (and maybe there are also data secrecy laws involved?) so for me it’s more propable that banks stay the course with the manual reporting done by the employee.
That’s up to you but definitely a tip for all people on this forum when interviewing for a position in a financial institution → ask for the trading and account limitations as soon as possible.
As I said I can’t say for 100%. Maybe others can share more experiences. As my employer is a financial institution but does not impose any restrictions I might have been a bit biased by saying I don’t know anyone tracking their employees trading activity…
if your future employer is using this tool, good for you. That’ll work.
I doubt (by experience in the banking industry) that many Swiss financial institutions are using IB compliance tool, neither API to track employees transactions.
As written above, to be discussed during interviews.
At the end, your future employer will impose its policy, not the opposite
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. As pointed out by others this is usually done in a fixed recurring timeframe where you have to manually fill out a form to the compliance team about tradings.
