Article 35 FINMASA
empowers FINMA to confiscate illegal profits so as to ensure fairness and equal treatment among market participants, thus protecting creditors, investors and policyholders and strengthening the proper functioning of financial markets. As well as having a preventive effect, confiscation serves to restore compliance with the law by eliminating illegal advantages.
Individuals and legal entities affected
Profits can be confiscated from supervised institutions or individuals in senior functions, for instance directors, executives and other managers. Under the Stock Exchange Act, any individual or legal entity committing a serious violation of the ban on market manipulation and insider trading
or the disclosure requirements
can also have profits confiscated.
FINMA has the power to issue disgorgement orders for unlawfully generated profits and any losses avoided. The law allows FINMA to estimate the profit generated or loss avoided if calculating it precisely is impossible or entails a disproportionate effort, which is often the case.