Hildebrand’s Resignation Risks Hobbling Swiss Financial Firepower

Questions about controversial foreign exchange transactions cost Philipp Hildebrand his job as president of the Swiss National Bank. Swiss leaders are eager to put the affair behind them. But the damage to the country’s financial credibility may already b

The Swiss stock Exchange in Zurich (Toni_V)
The Swiss stock Exchange in Zurich (Toni_V)
Bernhard Fischer

ZURICHEven before Philipp Hildebrand finally resigned, the scandal engulfing the head of the Swiss National Bank (SNB) was making waves at home and abroad. The Hildebrand family's controversial foreign exchange transactions were casting both the bank and its former president in an increasingly poor light. That had consequences not only for the credibility of the SNB Directorate but also for Switzerland's reputation in the many international organizations of which it is a member.

Hildebrand wasn't just SNB president. He was also vice-president of the Financial Stability Board (FSB). The FSB is an international organization that monitors the global financial system. Behind the scenes last summer, Switzerland was offered the VP position to make up for non-membership in the G-20 club – a membership that may yet lie ahead as the criterion for entry is the importance of a country in the world economy. The FSB position further enhanced Switzerland's importance in the international arena.

For years, Switzerland has wanted to be part of the club of the world's most important industrial nations but membership has so far eluded the Confederation. If Switzerland is a prominent member of the International Monetary Fund (IMF), the OECD and the FSB it is partly because "as a non-member of the G-20 it is all the more important for Switzerland to play a strong role in these organizations," says Mario Tuor, spokesman for the State Secretariat for International Financial Matters (SIF).

Federal authorities are eager to turn the page on the Hildebrand affair. Swiss leaders deemed media coverage of the affair to be "too dramatic," according to government sources.

A call for quick and decisive action

According to Klaus Armingeon, director of the Institute of Political Science at the University of Bern, the SNB's reputation had already taken a beating before Hildebrand resigned. "Not only was President Hildebrand's possible misconduct detrimental to the reputation of the SNB, so was the political staging," he says.

Since Hildebrand has now resigned and his eventual misconduct may be subject to further revelations during investigations to follow, all other actions to clear the situation up must be quick and decisive, says Armingeon – "mainly to prevent further damage." Armingeon fears massive collateral damage from the affair for Switzerland both politically and for various institutions. From his standpoint it would have been better "to put all the facts on the table, and report on them openly, no holds barred, from the outset."

Now that Hildebrand is no longer the head of the SNB, he also loses his position at the FSB, leadership of which is comprised exclusively of central bankers and representatives of finance ministries. FSB spokeswoman Margaret Critchlow declined to reply to this paper's question as to whether, at the group's next plenary assembly in Basel on Jan. 10, the damage to Switzerland's reputation would be discussed.

Hildebrand's resignation may also harm Switzerland's significant position in the world of international finance. As far as the G-20 is concerned, it may well further put off the possibility of Switzerland becoming a member.

Read the original article in German

Photo - Toni_V

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How Thailand's Lèse-Majesté Law Is Used To Stifle All Protest

Once meant to protect the royal family, the century-old law has become a tool for the military-led government in Bangkok to stamp out all dissent. A new report outlines the abuses.

Pro-Democracy protest at The Criminal Court in Bangkok, Thailand

Laura Valentina Cortés Sierra

"We need to reform the institution of the monarchy in Thailand. It is the root of the problem." Those words, from Thai student activist Juthatip Sirikan, are a clear expression of the growing youth-led movement that is challenging the legitimacy of the government and demanding deep political changes in the Southeast Asian nation. Yet those very same words could also send Sirikan to jail.

Thailand's Criminal Code 'Lèse-Majesté' Article 112 imposes jail terms for defaming, insulting, or threatening the monarchy, with sentences of three to 15 years. This law has been present in Thai politics since 1908, though applied sparingly, only when direct verbal or written attacks against members of the royal family.

But after the May 2014 military coup d'état, Thailand experienced the first wave of lèse-majesté arrests, prosecutions, and detentions of at least 127 individuals arrested in a much wider interpretation of the law.

The recent report 'Second Wave: The Return of Lèse-Majesté in Thailand', documents how the Thai government has "used and abused Article 112 of the Criminal Code to target pro-democracy activists and protesters in relation to their online political expression and participation in peaceful pro-democracy demonstrations."

Criticism of any 'royal project'

The investigation shows 124 individuals, including at least eight minors, have been charged with lèse-majesté between November 2020 and August 2021. Nineteen of them served jail time. The new wave of charges is cited as a response to the rising pro-democracy protests across Thailand over the past year.

Juthatip Sirikan explains that the law is now being applied in such a broad way that people are not allowed to question government budgets and expenditure if they have any relationship with the royal family, which stifles criticism of the most basic government decision-making since there are an estimated 5,000 ongoing "royal" projects. "Article 112 of lèse-majesté could be the key (factor) in Thailand's political problems" the young activist argues.

In 2020 the Move Forward opposition party questioned royal spending paid by government departments, including nearly 3 billion baht (89,874,174 USD) from the Defense Ministry and Thai police for royal security, and 7 billion baht budgeted for royal development projects, as well as 38 planes and helicopters for the monarchy. Previously, on June 16, 2018, it was revealed that Thailand's Crown Property Bureau transferred its entire portfolio to the new King Maha Vajiralongkorn.

photo of graffiti of 112 crossed out on sidewalk

Protestors In Bangkok Call For Political Prisoner Release

Peerapon Boonyakiat/SOPA Images via ZUMA Wire

Freedom of speech at stake

"Article 112 shuts down all freedom of speech in this country", says Sirikan. "Even the political parties fear to touch the subject, so it blocks most things. This country cannot move anywhere if we still have this law."

The student activist herself was charged with lèse-majesté in September 2020, after simply citing a list of public documents that refer to royal family expenditure. Sirikan comes from a family that has faced the consequences of decades of political repression. Her grandfather, Tiang Sirikhan was a journalist and politician who openly protested against Thailand's involvement in World War II. He was accused of being a Communist and abducted in 1952. According to Sirikhan's family, he was killed by the state.

The new report was conducted by The International Federation for Human Rights (FIDH), Thai Lawyer for Human Rights (TLHR), and Internet Law Reform Dialogue (iLaw). It accuses Thai authorities of an increasingly broad interpretation of Article 112, to the point of "absurdity," including charges against people for criticizing the government's COVID-19 vaccine management, wearing crop tops, insulting the previous monarch, or quoting a United Nations statement about Article 112.

Juthatip Sirikan speaks in front of democracy monument.

Shift to social media

While in the past the Article was only used against people who spoke about the royals, it's now being used as an alibi for more general political repression — which has also spurred more open campaigning to abolish it. Sirikan recounts recent cases of police charging people for spreading paint near the picture of the king during a protest, or even just for having a picture of the king as phone wallpaper.

The more than a century-old law is now largely playing out online, where much of today's protest takes place in Thailand. Sirikan says people are willing to go further on social media to expose information such as how the king intervenes in politics and the monarchy's accumulation of wealth, information the mainstream media rarely reports on them.

Not surprisingly, however, social media is heavily monitored and the military is involved in Intelligence operations and cyber attacks against human rights defenders and critics of any kind. In October 2020, Twitter took down 926 accounts, linked to the army and the government, which promoted themselves and attacked political opposition, and this June, Google removed two Maps with pictures, names, and addresses, of more than 400 people who were accused of insulting the Thai monarchy. "They are trying to control the internet as well," Sirikan says. "They are trying to censor every content that they find a threat".

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