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WORLD NEWS Thursday 30 March 2023

U.S.: Credit Suisse violates deal on rich clients’ tax evasion

By JAMEY KEATEN and
COURTNEY BONNELL
Associated Press
GENEVA (AP) — Credit Su-
isse violated a plea agree-
ment with U.S. authorities
by failing to report secret
offshore accounts that
wealthy Americans used
to avoid paying taxes, U.S.
lawmakers said Wednes-
day, releasing a two-year
investigation that detailed
the role employees at the
embattled Swiss bank had
in aiding tax evasion by cli-
ents.
The U.S. Senate Finance
Committee pointed to an
ongoing, possibly criminal
conspiracy tied to nearly
$100 million in accounts
belonging to a family of
American taxpayers that
the bank did not disclose. A sign displays the name of Credit Suisse on the floor at the New York Stock Exchange in New
York, Wednesday, March 15, 2023.
It also said Credit Suisse Associated Press
helped a U.S. businessman
hide more than $220 million customers withdrew their outstanding lawsuits and With that maneuver, “Cred-
in offshore accounts from money. investigations as part of the it Suisse enabled what ap-
the IRS. The Senate findings pose Credit Suisse acquisition pears to be potentially
Credit Suisse revealed that new problems for UBS as it and expects the deal to be criminal tax evasion by a
it had found 23 accounts tries to absorb Credit Suisse beneficial for sharehold- client to go undetected for
each worth more than $20 and create a single Swiss ers. It’s working to close the almost a decade,” the re-
million that were not de- megabank, coming the sale and get approval from port says.
clared to tax authorities, same day that UBS named regulators in the coming The committee said for-
many of them unveiled a new CEO to help push weeks or months. mer senior bankers helped
just days before the report through the takeover. It’s The Senate report noted manage that family’s ac-
was released, according also Credit Suisse’s latest Credit Suisse’s cooperation counts. In addition, Credit
to the committee. It said run-in with U.S. authorities, with the investigation, in- Suisse employees helped a
its findings show that more following settlements worth cluding having appointed U.S. businessman hide $220
than $700 million was con- hundreds of millions of dol- new leadership. million from U.S. authorities
cealed in violation of the lars over mortgage-backed The Swiss lender paid a dis- despite long knowing he
bank’s 9-year-old plea securities that were behind counted fine of $1.3 billion was an American, accord-
deal with the U.S. Justice the 2008 financial crisis. to the U.S. Justice Depart- ing to the report, which
Department. Credit Suisse, whose ment after pleading guilty said whistleblowers flagged
“Credit Suisse got a dis- yearslong troubles range in 2014 to conspiracy to aid the scheme after the plea
count on the penalty it from hedge fund losses to and assist U.S. taxpayers in deal.
faced in 2014 for enabling fines for failing to prevent filing false income tax re- Credit Suisse workers were
tax evasion because bank money laundering by a turns and other documents incentivized to help ac-
executives swore up and Bulgarian cocaine ring, with the IRS. counts hide U.S. ties be-
down they’d get out of the said it “does not tolerate The bank acknowledged cause their bonuses de-
business of defrauding the tax evasion” and insisted “knowingly and willful- pend on the amount of
United States,” said Sen. that the Senate report de- ly” helping thousands of money being managed,

Ron Wyden, the Democrat- scribed “legacy issues” Americans open accounts the report said.
ic chairman of the com- some dating to a decade that weren’t declared to To that end, employees
mittee. “This investigation ago that have been ad- tax authorities and con- who had clients with assets
shows Credit Suisse did not dressed since. “We have cealing offshore assets. It above $20 million or $30 mil-
make good on that prom- implemented extensive avoided criminal charges lion may have given those
ise, and the bank’s pend- enhancements since then in exchange for agreeing accounts special consid-
ing acquisition does not to root out individuals who to report undeclared ac- eration because it would
wipe the slate clean,” he seek to conceal assets from counts and provide other mean they got larger bo-
said. The Swiss government tax authorities,” the Zurich- information to U.S. officials. nuses, the committee said.
pressed for a $3.25 billion based bank said. The Senate committee said Investigators say bankers
takeover of long-troubled “Our clear policy is to close secret offshore accounts figured out how to code
Credit Suisse by rival bank undeclared accounts belonging to a family of accounts for Americans
UBS this month amid tur- when identified and to dis- dual U.S.-Latin American who possess dual citizen-
moil in the global finan- cipline any employee who citizens and worth nearly ship. Those bankers would
cial system. The collapse fails to comply with bank $100 million were closed in use the non-U.S. passport
of two U.S. banks ignited policy or falls short of Credit 2013 but the money was of wealthy individuals to
wider fears that sent shares Suisse’s standards of con- transferred to other banks evade internal systems de-
of Switzerland’s second- duct,” it said. without telling U.S. authori- signed to look for identifying
largest bank tumbling as UBS said it has assessed ties. marks in U.S. passports.q