Rudolf Elmer as a modern day Gandhi

Taunted whistleblower asks for ‘adequate transparancy’ to overcome democratic flaws

15 FEBRUARY 2016 | Jan Verdonk

We all know Julian Assange and Edward Snowden. They are probably the best-known whistleblowers of our time. However, there are more people who bring information to surface about illegal or dishonest activities, in all kinds of sectors. Who searches the Internet can find a lot about the information they share, but how do people like them think about the world? Is their worldview fatalistic or are they positive about the future of our society? In the series of interviews that will follow I will talk to several whistleblowers and discuss what they perceive to be the biggest threats of our modern society. What solutions do they have? And do they ever regret their decision to expose their information to the world? 

It reads like a novel, the story of the former banker Rudolf Elmer (60). After leaking secret information of his former employer Julius Bär he was taunted, harassed, jailed (217 days investigative detention) and finally prosecuted. While his health deteriorated, he scarcely found protection. Elmer kept fighting though, believing in the goodness of his mission. Today he has entered politics to be a leading example. But how does a whisteblower like Elmer think about the current Western political system and its flaws after everything he has been through? I asked him about it and talked about both the problems and the solutions.

Rudolf Elmer worked for the largest Swiss private bank Julius Bär for nearly two decades. During the last eight years, he ran the bank’s Caribbean operations at the Cayman Islands, a hotspot of financial activities due to business-friendly regulations. Elmer witnessed a large-scale tax evasion and noticed a sharp increase in the amount of risky deals, caused by a search for quick profits. As a compliance officer of the Cayman unit he  learned over the years that his own management kept crucial information hidden, which gave him the feeling he could not trust his superiors.  He was disappointed in this lack of ethics in the business industry and particularly its leaders. In December 2002 he was fired, after a dubious lie detector test – which was supposedly part of new security requirements – was performed on him in the Cayman Islands while he was on strong medication because of serious spinal injury, for which he had to undergo a surgery four weeks later. His medical condition was ignored during the test, which he eventually could not even complete due his recurring pain. Retrospectively, Elmer argues it is clear to him that he, being labelled as ‘a critical thinking person’ in his interim certificate of 1999, had to be eliminated. He stresses that critical thinking people in such an organisation are a pain in the neck for every management.

Crusade against Julius Bär

During his time at the Cayman Islands Elmer was responsible for dealing with hurricane emergencies, which meant that he would always have security backups of the bank’s server when the weather service issued a warning. He was also requested by his management to take a daily backup home in case there was a fire in the bank. He was supposed to return these to the bank, but when he was fired he still possessed a copy. Elmer would later send this to the Swiss tax authority, to the Local and Federal Prosecution Office of Switzerland and to the media. But when he did not get the proper response he hoped for he started sharing his information with media, like WikiLeaks in 2008. However, he would eventually pay a big price for his crusade against Julius Bär and offshore abuses.

In 2005 Elmer was taken into custody for thirty days by the Swiss authorities, after he was accused of breaching the Swiss banking secrecy and of extorting officials of Julius Bär. The bank pictured him as a vengeful ex-employee, an image that according to Elmer was taken over by most Swiss media. What followed was a long period of intimidations, accusations and legal actions. It culminated in a post-traumatic stress syndrome for Elmer, who almost accepted hush money because of his deteriorating health. However, he continued his battle even though he felt he had to fight a corrupt legal system with judges and prosecutors who were keen on convicting Elmer from the start.

Political career

In april 2015 Elmer was the number three at the electoral roll of Die Alternative Liste during the elections in the district of Bülach. AL is a small leftist movement that is active in the cantons of Zürich and Schaffhausen. The banker is a politician now. That is remarkable, as the Swiss political system did not support Elmer when he broached the issue of tax evasion. Therefore, the big question is whether he is a masochist or someone who truly believes in the power of the democratic model. I confronted Elmer with what are often considered as some major flaws of the Western democratic system. What does he think about these obstacles, and what solutions does he see?

Dear Rudolf! After everything you have been through, you decided to enter politics. A remarkable choice, as the Swiss democracy failed to protect you earlier on. Do you really believe in modern western democracy?

“Yes I do, even though our western democracy – and in particular the Swiss – is in many fields money-driven. My case clearly demonstrates this if one goes into detail.  Certain multinational organizations, ultra high net worth individuals and in particular the Swiss authorities take the view that profit and power are the highest goals to be fulfilled in order to gain the reputation of being successful and a respected contributor to today’s wealth in the western society.

In fact the hidden agenda – or better the real driver – is simply greed, which is actually the biggest enemy of a true democracy. I know this is philosophical but we need to change the values in our society in order to walk our talk and to achieve what we proclaim to be a “true democracy”. In my view, there is still plenty to do to achieve excellence in our western society but we are on our way. The culture of whistleblowing for example is about to be established in order to seriously fight abuse practices in many fields.

Finally, even though Swiss democracy and the national authorities failed to protect me, I decided to take the bull by the horns and return to Switzerland in 2010 and face court trial after court trial, imprisonment, social death, financial burden and a treatment as an outlaw. I strongly believe that is the way to change things, to make it visible for society and simply lead by example. I am convinced I have become a nuisance for the Swiss establishment, maybe even similar to Dietrich Bonhoeffer for Adolf Hitler, Mahatma Ghandi for the English and even Jesus for the Jewish people. However, I do not compare myself with those great characters, I only have learned from them.’

Lincoln’s lessons

As a modern day Gandhi Elmer clearly sees what adverse powers he is fighting against, and what can be done to bring about positive change for the short term.

Your case clearly proves that our current western political system is not able to protect all people who are open about the injustice they face in their area of expertise. What are the most important opposing powers that are at work here in your view?

‘In my view, they are certain multinational organizations and certain ultra high net worth individuals who want to silence me and disguise the truth about the financial industry. Abraham Lincoln said it nicely:

‘I have two great enemies, the southern army in front of me and the financial institutions, in the rear. Of the two, the one in the rear is the greatest enemy….. I see in the future a crisis approaching that unnerves me and causes me to tremble for the safety of my country. As a result of the war, corporations have been enthroned and an era of corruption in high places will follow, and the money power of the country will endeavour to prolong its reign by working upon the prejudices of the people until wealth is aggregated in a few hands and the Republic is destroyed. I feel at this moment more anxiety for the safety of my country than ever before, even in the midst of the war.’

I can only add that today, besides the financial institutions, we need to mention multinational organizations as well.”

Suppose these observations are true. What should be done to transform our political system in a way that it sincerely protects us from injustice?

“I have to limit my statement to my own battle, which felt like “David against Goliath”, because that is what I really can talk about and where I have experienced the shortcomings in respect of justice. The biggest issues are – and this might look really narrow-minded but those are key problems – firstly, politicians and political parties have to publically declare who sponsors them (financially by contributions, Board Memberships for politicians, the benefits they receive); secondly, judges and prosecutors should not be elected anymore based on their political membership or because of the voting power of their supporting political party; thirdly, abusive practice should be sanctioned with prison sentences for the responsible managers and not only fines/financial deals for corporations because “justice is definitely not for sale”; fourthly, countries which do not cooperate with generally accepted rules like “automatic information exchange” for instance, will face sanctions and fifthly, it needs a global body (e.g. G-7, United Nations) which has the power to globally police abusive tax regimes. Tax evasion for example is not a crime in Switzerland, therefore for decades no mutual administration assistance was required. I am convinced that with above concept a lot of injustice could be eliminated easily.”

Rethinking our values

Elmer advocates some additional codes of conduct for politicians. Democratic purists point out that today politics is more about who is delivering the message, instead of about the message itself. What does Elmer think about this development? And to what extent does he see a threat in the increasing influence of lobbyists on the content in the political process?

Some people say the way we shape our European democracies starts to resemble the way the US does. More and more, it is not the message that matters, but the messenger himself. What is your view on this?

“We can learn a lot from the US! However, we do not have to make the same mistakes again and therefore message needs to become more important again. In my view, it has to do with the values which are important to us. We should teach our children the insight about this message-messenger issue and discuss it at the family table and with friends in society. On the other hand we have to lead by example. For instance, I take the Swiss media to court if they write about me as a mentally sick person, a thief or a blackmailer etc. The presumption of innocence still exists in my case. All the verdicts issued by the Lower Court of Zurich are not final yet, they are blocked with the appeal Court of Zurich for close to five years right now.”    

Lobbyists are finding their ways to our politicians every single day. Regulation at this important point is lean, in both the EU as in individual countries. What do you think about the influence lobbyists are having, and to what extent do you think we should change the existing system?

 “Lobbyists have a major influence today everywhere and I am convinced too often not in favour of the man in the street. An effective way to have it changed is “adequate transparency”. By this I mean that politicians have to declare publically what kind of benefits they receive and from whom. The citizen has the right to know it because the citizen elects his politician and even pays for his salary by fairly and correctly declare his tax bill.”  

‘No time for political activism’

The ordinary man on the street should get more insight in the way political parties are supported according to Elmer, in order to vote more consciously. However, the average citizen does not really seem to care about his rights, even in an era of a global financial crisis. Elmer does think citizens are frustrated, but suspects a lack of time impedes them from becoming politically active.

Meanwhile, the man on the streets does not seem to show a great deal of political activism, even after the economic crisis we are still in. Even some big scandals only seem to bother him for only a couple of days. How do you explain this?

“I think there is a lot of frustration the man in the street suffers from and he is not willing anymore to fight against abusive practice in whatever field as long as he is in a position of a victim. The man in the street is under enormous pressure simply to make month ends meet. There is little time to challenge anything because there is always the risk to lose his job, destroy relationships, having big debates with family members etc. Secondly, it is very difficult to see what those scandals really mean for his life.”

You are an advocate for more transparency. Currently, the US and Europe are talking about a Transatlantic Trade & Investment Partnership (TTIP). To what extent do governments need to inform the people about this according to you?

“I am an advocate for “adequate transparency”. Furthermore, I use the concepts of “Must-“, ”Need-” and “Nice-To-Know”. In the case of TTIP it is clearly a “Must-To-Know” for the citizens because it will have a direct impact on their day-to-day life. “Adequate transparency” would definitely nourish trust and that actually is the basis to have more people involved e.g. in political matters. Trust is simply the key! If you do not trust someone, the normal reaction is to avoid that person in order to avoid the topic. To be clear, “Adequate Transparency” really ends where privacy begins!”

Immorality in neoliberal education

Even if Elmers plan of ‘adequate transparency’ gets off the ground, there is still a less visible effect on the establishment of the message politicians are delivering. These representatives are usually educated in a system where the agenda is largely determined by neoliberal thinkers. Business universities teach their own dogmas over there. Elmer noticed the effect of this in his own work, and emphasizes the need for change.

Among the people who are responsible for shaping educational policies are many neoliberal thinkers. At schools, we are told consumers are rational actors. We are also told transparency is one of the conditions for perfect competition. Criticists claim these kind of stories are utopian fairy tales. What do you think about this?

“I think it is important to understand how things really work and to consider the hidden agenda of the educational business, particularly in business universities and the neoliberal thinkers. However, that takes time and a lot of insight, honesty and experience in the particular field as well as the view for the big picture. Unfortunately, there are hidden and more importantly unmoral and unethical interests which are legally accepted but not legitimate. For example, our money system is legally accepted but it is not legitimate because most of the money is created and controlled by the financial institutions and not – as the man in the street believes – by the Central Bank. I refer here to the “Positive Money-Movement” in the UK, Islands, and Switzerland etc. Therefore, I think a lot of manipulation is going on. Or, as you say, utopian fairy tales are told. My fear is that it escalates and culminates in propaganda in the sense we learned from the bankers: “Don’t get caught, make profit”.”

And what do you think about the neoliberal influence at our education?

“I only can talk about what I have experienced during my education in Switzerland and the United States. Obviously, I have had a neoliberal education for decades and only lately I have learned that I have been manipulated for decades in order to do jobs I did in eight offshore jurisdictions. It was quite a shock to me to note that the equation, which in my view is the outcome of neoliberal thinking (Debt=Consumption=Growth=Progress), caused the situation where now states and individuals suffer from so much. This approach, allowing to make debts in order to consume, is the driver for growth and we call it progress. In simple terms, debt is equal to progress, which is entirely wrong because society is now confronted with an extremely difficult problem to solve due to this neoliberal thinking and policy.”

Should this be changed?  

“It not only “should” be changed, it must be changed! Particularly in leading universities, where future business leaders study. It needs a fundamental change of thinking. It is not only about economics, and it is about ethics and many other things.”

Other dogmas: globalisation and GNP

Besides the neoliberal dogmas we are confronted with some deeply rooted assumptions every day. For example, there is the impact of globalisation and the concept of the ‘gross national product (GNP)’, which usually provides governments legitimacy. At schools we are often told about the benefits of globalisation, even though corporations and banks misuse it in order to avoid paying taxes. The GNP continues to be the dominant instrument to measure the economic performance of nation states, despite the criticism of some economists.

Something that is often praised at schools is globalizations. However, big corporations like Google and Starbucks are often criticized for globalising in order to reduce tax pressure. How do you think we can avoid this undesirable behaviour?

“Globalization is not only a weapon for banks to avoid paying taxes, it is clearly a weapon for multinational organizations und certain ultra high net worth individuals to avoid taxes. It obviously needs a global body to tackle fraudulently behaviour. In fact, with the G-7, UN, OECD even the G-20 we do have options but up to now they have proven to be toothless weapons. We even do have laws on the national level in place to tackle fraudulent behaviour but the authorities do not execute those laws. My case is a striking example for not executing the laws because I have been investigated for close to eleven years but all the complaints I filed in Switzerland against the bank and individuals have been turned down by the judges.”

The economic progress of countries is still measured by their GDP’s, even though there are economics who are criticizing this way of judging nations. How do you think about this, and to what extent can economics provide governments legitimacy in the first place according to you?

“Allow me to make this comparison when I applied for the job in Mauritius, which used to be a low cost country. At those days my annual salary was around 60.000 British Pounds, which for a director is not that much. However, my family lived in a big house, a big garden and we had sufficient family time etc. In short, had a great lifestyle and I still could safe 15.000 British Pounds per year. Therefore, my personal “GDP” was much better in comparison to many European managers. What I want to say is that bottom line counts and that means it is not only money that counts but more importantly it is about the lifestyle a country can offer to its citizens. I am aware the lifestyle is difficult to measure; it is easier to talk about GDP.”

Wrong values

The aforementioned dogmas are products of the modern time. Problems related to money and power have been around much longer. To deal with these difficulties Elmer returns to the topic of social values. According to him, the wrong people are often admired based on dubious arguments. He thus stresses the need for reflection.

In whatever industry we look at, at whatever moment in time, we seem to be able to find massive problems. Most of these problems are money related. Greed seems to be a persistent element of life. To what extent do you think there is an alternative?

“We, you and I, are responsible that those massive money related problems exists. We call people who have made a big fortune successful and we even admire them because money makes them powerful. The equation “a lot of money = success” is a creation of our modern society. In other words, we simply focus on the wrong values. We have to reconsider our values in our lives. Our history is rich with individuals who illustrate what success really means. For example, look at the life of Mahatma Gandhi, Nelson Mandela, Dietrich Bonhoeffer or more importantly parents who raise children who do not turn out to become a problem for society. The latter we underestimate and we do not talk about. However, I know from experience that my parents raised three boys and all of them turned out to be decent citizens. If you consider that we were raised in the red light district of Zurich, this is a tremendous achievement of my parents. There are many similar parents in our society but they will not be estimated for their great work.”

Suppose you would be appointed as the president of the European Central Bank. What would your priorities be?

“Thank you, but I am not smart enough to be appointed for such a position. However, one of the major goals would be to solve the debt crisis and chase multinationals, which pay only 1% taxes of the Groups’ profit we have learned from Lux Leaks.”

‘Adequate transparency’ the answer

Talking to Elmer, you feel he considers it a personal mission to educate people on the abuse around them. But did he ever regret his brave crusade? And what would he tell the Dutch people, who often believe their country is one of ‘the best boys in class’?

In the documentary about your case, it was made clear that countries are afraid to criticize Switzerland. Nations fear secrets about their own corrupt behaviour will be revealed once they do that. In The Netherlands, people tend to see our government as ‘the best boy in class’. What should the Dutch public know about its country?

“Firstly, I do not think that the people of the government in the Netherlands are so much different from other governments. Secondly, during my career I have come across some Dutch tax evaders. However, the Dutch public needs to know that only an “adequate transparency” would help to gain trust in the management of a country. Politicians, I will stress this once again, have to declare their income, their board memberships and the financing of their political parties. Only then I would feel comfortable as a citizen to support a politician.”

It is time for my final question. If you look at the persistence of big problems, we are facing in our society, and if you consider everything you have been through after becoming a whistleblower, has there never been a moment of regret of your brave actions. Although the reputation of bankers is affected by the global financial crisis, probably no one would have blamed you for being a conformist?

“I have gone through many moments of regret, mostly due to the fact that my daughter and my wife had to accept that I walked my way and did not take the easy path. My colleagues passively accepted an abusive system, but I did not do this.  On the personal level, it has been and still is a wonderful path to follow knowing “If God is for us, who can ever be against us?”.”

At the moment, Elmer is on a tour to promote a documentary about his story. Premieres at the end of January in Biarritz and Solothurn in Switzerland were received very well by the visitors. It will help to raise awareness about a side of our society that is too often neglected. Therefore, I wish Rudolf all the best and I would like to thank him for the interview.




For those interested in Elmer’s case, here are some interesting sources: