August 11, 2022

DealBook: Credit Suisse Discloses U.S. Inquiry Into Private Banking

An office of the Swiss bank Credit Suisse in Zurich.Arnd Wiegmann/ReutersAn office of the Swiss bank Credit Suisse in Zurich.

Credit Suisse said Friday it had been notified that it was the object of an investigation by the United States Department of Justice, citing “a broader industry inquiry.”

The Swiss bank said that it had previously received subpoenas and other information requests from the Justice Department and other government agencies regarding cross-border services that its private banking arm provided to American clients.

“We will continue to cooperate with the U.S. authorities in an effort to resolve these matters,” the bank said.

Four private bankers tied to Credit Suisse were indicted in the United States in February for helping Americans evade taxes. Marco Parenti Adami, Emanuel Agustoni, Michele Bergantino and Roger Schaerer, who were linked to two other private banks in Switzerland, and one in Israel, were accused of conspiracy and fraud.

The bankers, three of whom had left Credit Suisse before they were indicted, were accused of helping American clients set up offshore accounts under false names, and shifting money from Credit Suisse accounts to smaller Swiss private banks.

At the time, Credit Suisse said it was not the object of an investigation by the Justice Department, and industry observers thought it might be able to strike a deal with American authorities by paying a fine, much like UBS did in 2009.

The announcement Friday raises the stakes for Credit Suisse. UBS paid a $780 million fine and handed over data on thousands of clients to avoid a conviction in a similar case that could have cost it its banking license in the United States.

In March, an American, Edward Gurary, pleaded guilty to tax evasion and admitted hiding assets not only at UBS, but also Credit Suisse.

The Justice Department began its investigation of Credit Suisse’s private banking operations, along with those of its rival HSBC, in 2008, as an outgrowth of the UBS investigation. The inquiry began by focusing on whether the two banks had $30 billion in offshore accounts that Americans had not declared to the Internal Revenue Service.

Last month, Steven Miller, the deputy commissioner for services and enforcement for the I.R.S., said at conference on taxation in Washington that authorities planned to take action against one or more banks soon, without mentioning any by name, an attendee at the meeting said.

Credit Suisse has tangled with the department before, and lost. In December 2009, Credit Suisse paid $536 million to settle charges that it had broken American sanctions by helping Iranian banks to hide the identity of their clients in international dealings.

Spokespeople for the Department of Justice and the Internal Revenue Service declined to comment.

Article source: http://feeds.nytimes.com/click.phdo?i=95001dbc864c9fc1b48e5ae550468c9b

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