According to the report, Credit Suisse transferred more than $100 million from a US dual-national family to offshore accounts without notifying the Justice Department, in violation of the plea agreement. The report says bank employees also “knowingly helped” Dan Horsky, a US business school professor who pleaded guilty in a 2016 tax fraud case, to shield $220 million from US tax authorities.
In addition, the report notes that years after the plea deal, Credit Suisse disclosed that there were 23 “potentially unreported accounts” of US citizens, each with at least $20 million. According to the report, Americans have at least $700 million hidden in Credit Suisse.
“It could be much higher,” said Ryan Carey, spokesman for the Senate Finance Committee. “We just don’t have much insight into those accounts,” only that they contain at least $20 million.
In a statement, Credit Suisse said the report describes “legacy issues,” some going back a decade, and that it has implemented protocols designed to weed out individuals who try to hide assets from U.S. tax officials. The bench noted that it has been working with the Senate Judiciary Committee, as well as the Justice Department, “to address, and will continue to address, a number of outstanding issues of conduct or policy.”
“Credit Suisse does not tolerate tax evasion,” the statement said.
The allegations come during a turbulent period for Credit Suisse, which is now being gobbled up by rival UBS under a deal brokered by the Swiss government. UBS acquired Credit Suisse this month for $3.3 billion as concerns over the bank’s stability grew. The move was designed to bring calm to the banking system, which was still reeling from the collapse of Silicon Valley Bank and Signature Bank in the United States. And while some calm has returned to the industry, UBS still has to take on the monumental task of merging with another behemoth.
The panel’s findings may be another headache in that process. The report’s authors believe that any entity that acquires Credit Suisse could be held liable for any fines resulting from violations of the 2014 plea deal, in which Credit Suisse agreed to disclose all of its cross-border activities, among other measures. If prosecuted by the Justice Department, fines could exceed $1 billion in fines.
In a statement to The Washington Post, UBS spokesperson Erica Chase said: “As part of our due diligence regarding UBS’s acquisition of Credit Suisse, we have completed an assessment of pending litigation and investigative issues. We expect the transaction to benefit our shareholders in a broad range of business scenarios.”
In May 2014, Credit Suisse pleaded guilty to helping wealthy Americans hide billions of dollars to evade taxes. In exchange for paying a smaller fine — $1.3 billion — the bank had also agreed to a series of compliance measures, including disclosing its cross-border activities, complying with Justice Department requests for account information, and closing all accounts of account holders who refused to comply. with US tax laws.
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