Credit Suisse pleaded guilty to Federal criminal
charges Monday, for helping clients avoid tax payment by sending money
overseas. The global banking giant will pay a total of $2.6 billion in
penalties
The Swiss bank Credit
Suisse pleaded guilty Monday to helping U.S. citizens commit tax evasion
over the course of several decades, the Department of Justice announced. Credit
Suisse will pay the Department of Justice, the Federal Reserve and the New York
State Department of Financial Services
a total of $2.6 billion in penalties, the largest payment ever in a U.S.
criminal tax case. The banking giant is the first global financial institution
to face a criminal conviction from U.S. authorities in more than a decade,
Bloomberg reports.
Credit Suisse bankers aided thousands of wealthy
Americans in concealing their money from U.S. authorities, the Department of
Justice said. The bank helped American clients set up shell accounts to shuttle
their money overseas and then solicited false IRS documents to make the
accounts seem legitimate. According to a U.S. Senate subcommittee report released
in February, Credit Suisse recruited new clients at bank-sponsored events, like
golf tournaments in Florida and a gala in New York. In one instance, a Credit
Suisse employee handed a client secret bank statements hidden in a copy of
Sports Illustrated during a breakfast meeting. Credit Suisse had 22,000 U.S.
customers with about $13.5 billion in their Swiss accounts in 2006, the “vast
majority” of which was undeclared to U.S. authorities, according to the report.
“This case shows that no financial institution,
no matter its size or global reach, is above the law,” Attorney General Eric Holder
said in a release announcing the conviction. “Credit Suisse conspired to help
U.S. citizens hide assets in offshore accounts in order to evade paying taxes.
When a bank engages in misconduct this brazen, it should expect that the
Justice Department will pursue criminal prosecution to the fullest extent
possible, as has happened here.”
As part of its deal, Credit Suisse must disclose
its cross-border activities and cooperate in requests for account information
from the U.S. government. The bank must also provide info about other banks
that helped transer funds into secret accounts and close the accounts of
Americans who improperly report their assets to the U.S. government.
The move comes as part of an overall crackdown
by the Department of Justice on offshore bank accounts. As part of the same
investigation, the Department of Justice has indicted eight Credit Suisse
executives since 2011. Two of them have pleaded guilty to criminal acts.
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