Swiss drop Bhuto fraud inquiry

Switzerland said today it had closed an investigation into Benazir Bhutto for alleged money laundering, but a parallel probe into her husband’s activities will continue.

A three-year investigation into allegations that Ms Bhutto used Swiss banks to launder millions of dollars in kickbacks has been closed, her lawyer Alec Reymond said.

Ms Bhutto had denied the charges saying they were politically motivated.

Mr Reymond said proceedings would continue against Ms Bhutto’s husband, Asif Ali Zardari, and another unnamed individual.

In 1998, Swiss authorities said they found 20 million Swiss francs (€12m) in Swiss accounts belonging to Ms Bhutto and her family. The accounts were frozen at Pakistan’s request.

“Miss Bhutto has always said that this was not her money. The accounts were not in her name,” Mr Reymond said.

Swiss and Pakistani investigators allege much of the money came from Societe Generale de Surveillance, one of the world’s largest customs inspection companies, in exchange for business with the Pakistani government when Ms Bhutto was prime minister in the late 1980s and 1990s.

In 2003 a Geneva magistrate convicted Ms Bhutto and her husband in their absence of money laundering under a Swiss law that allows high-level investigators to impose penalties without a court hearing.

They were given six-month suspended sentences and ordered to pay massive fines to the Pakistan government.

The convictions were automatically thrown out when the pair contested the move.

In July 2004, another Swiss magistrate charged them again, reopening the corruption case.