The former Swiss ambassador to Luxembourg, Peter Friederich, went on trial on Monday on charges of money laundering.
Friederich, who was arrested in July 2002, is also accused of assisting drug smugglers, embezzlement and fraud. If convicted, he faces up to ten years in prison.
Geneva’s former prosecutor, Bernard Bertossa, is to decide Friederich’s fate at the new Federal Criminal Court in Bellinzona.
The case is based on a 200-page dossier compiled by federal judge, Paul Perraudin, which federal prosecutors have been studying since August 2004 to decide what charges to bring against the former ambassador.
The prosecution’s two principal accusations are assisting – and possibly belonging to – a criminal organisation, and money laundering.
Friederich, 63, is also charged with financial negligence, falsifying documents, damaging creditors’ interests, embezzlement and calculated fraud. He is also facing a number of civil lawsuits.
His lawyer, Didier Bottge, said his client denied all the charges against him.
"Peter Friederich would at best only be a small cog in a much bigger system," Bottge told swissinfo. "I’m also surprised that he is the only person to go on trial anywhere when investigations took place in a number of countries."
Friederich’s diplomatic career spanned 30 years, and included three postings as ambassador - to Vietnam and Cuba and finally Luxembourg in December 1999.
The investigation found that, during these postings, Friederich invested large amounts of money in the stock market on behalf of friends and associates. He promised them a higher return on their investments than the market average.
According to the prosecution, Friederich helped himself to some of the money to pay off debts to other clients as well as for his own purposes.
When the stock market crashed in 2000, the former ambassador lost SFr5 million ($4.2 million), putting him under immense financial pressure.
Friederich was arrested in July 2002 after SFr2.37 million ($2 million) in cash deposits turned up in his private account in Luxembourg, when he was ambassador there. He was held in custody for over a month after his arrest.
The payments were made by Antonio Florido Sosa, known as "Radio Jaen", a Spanish citizen suspected by Spain of involvement in the drugs trade and money laundering.
Shortly after being paid into Friederich’s account, the money was transferred to bank accounts in Switzerland and other countries. The prosecution says the recipients were suspected of money laundering or linked to drug trafficking.
Originally Friederich said the money came from the sale of pictures, cigar boxes and antiquarian books – in addition to a clock made from Meissen china sold to a lawyer in Geneva.
His lawyers then claimed he believed the money had been deposited into his account by a Spanish fiduciary trustee in order to evade taxes.
Friederich later admitted that he lied about the origins of the money – and also admitted to falsifying the signature of the alleged buyer – but denied allegations of money laundering.
The prosecution will claim that Friederich was given the money by Adriana Jaramilo Rendon, known as "la Señora", during a series of meetings in hotel car parks around Europe.
Prosecutors say the pair met five times, starting in June 2001, and each time la Señora gave Friederich large amounts of used bank notes in various currencies.
La Señora was an accomplice of Radio Jaen and Spanish police had been watching them for some time.
An undercover investigation resulted in the interception of a boat travelling from Peru to Valencia and 570kg of cocaine was found stashed among a cargo of shrimps. Fifteen people were arrested, including Radio Jaen.
The prosecution believes Friederich earned SFr134,000 ($110,000) from the transaction, and they say he may even have offered to travel to Mexico to deliver $328,000 to a third party, who would in turn pay the money into a Columbian account.
Guilty or naive?
Friederich’s defence says he knew nothing about any drug network or mafia business, pointing out that the final payment arrived in his account before the discovery of the cocaine shipment.
The prosecution will say that, given the circumstances, Friederich must have realised that something crooked was going on.
"This trial will depend on how much Peter Friederich actually knew," says Bottge.
"I will plead for an acquittal on most of the charges. If the court should find him guilty, I hope he will receive a suspended sentence."
The trial is expected to last 12 days but the date of the verdict is not yet known.
swissinfo, Thomas Stephens
The trial of Peter Friederich began on May 9.
It is expected to last 12 days.
The principal charges are assisting a criminal organisation and money laundering.
Friederich faces up to ten years in prison.
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