Swiss prosecutors have dropped money laundering charges against Gulnara Karimova, daughter of former Uzbek President Islam Karimov, citing a legal roadblock that halts the case before the 2028 statute of limitations expires. The Lombard Odier private bank and a former employee remain under investigation for their alleged roles in a scheme that allegedly moved $500 million through Swiss accounts between 2005 and 2013. Court documents attribute the dismissal to Karimova’s detention in Uzbekistan, where she has spent over a decade in prison, making her participation in Swiss proceedings impossible.

The case, which once threatened to expose systemic anti-money laundering failures at Lombard Odier, now leaves regulators without a trial against the alleged mastermind. Prosecutors claim the bank enabled Karimova’s bribery network but face skepticism from the institution, which asserts it flagged concerns about her activities a decade ago. Legal experts suggest the ruling underscores the challenges of prosecuting cross-border corruption cases, particularly when key defendants are inaccessible.

While Karimova’s convictions in Uzbekistan for corruption and embezzlement stand, Swiss authorities are separately pursuing asset freezes tied to her alleged schemes. Her lawyer, Grégoire Mangeat, hailed the dismissal as an acquittal under Swiss law, criticizing her detention conditions and the validity of prior trials. The bank called the decision a reflection of the “fundamental complexities” in the prolonged investigation.

This development highlights Swiss courts’ struggles to navigate politically charged international cases, even as regulators maintain pressure on financial institutions to uphold compliance standards. The unresolved assets linked to Karimova’s activities could still face scrutiny, complicating efforts to recover funds.