Switzerland has proposed a new bill to prevent its banks and other institutions from accepting black money from their clients and put in place a stricter due diligence regime.

The Switzerland Federal Council, the apex decision making body of Swiss government, has asked its Finance Ministry to submit a consultation draft at the start of 2013 to meet its goal of preventing banks from accepting untaxed funds from their clients. A decision to this effect was taken by the Federal Council at a meeting on Friday in Bern.

The move follows rising global pressure on Switzerland to act against its banks providing safe haven to overseas entities in name of client confidentiality.

In a statement, the Swiss Federal Council said, it is stepping up its efforts to combat abuses in the area of money laundering and taxation.

It said, with the planned implementation of the revised recommendations of the Financial Action Task Force, serious tax offences will be qualified as predicate offences for money laundering in future.

It said, in the event that they suspect money laundering, financial intermediaries should also report these cases to the Money Laundering Reporting Office Switzerland.