SWITZERLAND - Jean-Pierre Roth, president of Switzerland's central bank, says he agrees with the view expressed by another top government official that many who run Swiss pension funds are incompetent.

Roth's comments were prompted by the Swissfirst insider trading scandal and come as one of the people at the centre of the affair, Rieter pension manager Jürg Maurer, hit back at media claims.

In an interview with Swiss newspaper Blick, Roth noted that considering the huge number of schemes (known as Pensionskassen), it was hardly surprising that incompetence was rife.

"Right now there are 8,000 Pensionskassen. I highly doubt that there are enough competent bosses to run that many schemes well," Roth said. The allegations involving Swiss bank Swissfirst has grown to include seven Pensionskassen.

According to Roth, another hindrance to effective regulation of Swiss Pensionskassen was that fact that many were responsible only to their local canton.

Roth's comments come two weeks after Ulrich Grete, president of Switzerland's Social Security Fund, caused a huge stir in the Swiss pensions industry by calling many who run Pensionskassen "bunglers". 

Swiss Pensionskassen association ASIP angrily responded to Grete's criticism. "To call those responsible at Pensionskassen bunglers is ridiculous, unfair and polemic. ASIP wholeheartedly dismisses such defamations and claims," the association said.
ASIP added that there were already enough rules to discourage and prevent illegal or criminal behaviour among managers and supervisors of Pensionskassen.

But Roth and Grete both feel that to improve corporate governance at Swiss Pensionskassen, Swiss government should encourage swift consolidation of the schemes. Grete thinks that only 1,000 schemes are need to insure workers.

The straight talk from the senior government officials comes in the wake of the Swissfirst affair. According to Swiss news reports, at least seven Pensionskassen may have participated in an as yet unproven insider trading scam engineered by Swissfirst chief executive Thomas Matter.

Swiss regulators have been investigating both Swissfirst and the Pensionskassen since early August but have yet made no announcement on their findings.

Also this week, Zurich's public prosecutor's office raided Swissfirst's headquarters in Zug, confiscating documents for its own criminal investigation.

Swissinfo said that Maurer today denied allegations of illegal insider trading in connection with the merger of banks Swissfirst and Bellevue.

It quoted him saying he did had not personally benefited and that his personal wealth had come from legitimate share trades.