Credit Suisse, the failed Swiss bank taken over by UBS Group AG in a hastily arranged bailout earlier this month, may bring with it a fresh set of regulatory and legal problems for its new owner, reported CNBC.
For years, the private bank has provided a safe haven for wealthy American clients to hide assets from the IRS — even after it was caught and prosecuted for doing the same thing more than a decade ago, according two former Credit Suisse bankers who spoke in exclusive interviews with CNBC and are working with the U.S. government as whistleblowers.
The bank notoriously pleaded guilty in 2014 to criminal charges for "knowingly and willfully" helping thousands of U.S. clients conceal their offshore assets and income from the IRS. It admitted at the time that it used sham entities, destroyed account records and hand delivered cash to American clients to avert IRS detection — agreeing to crack down on U.S. tax dodgers going forward as part of its plea deal. Credit Suisse also agreed at the time to a host of reforms, including disclosing its cross-border activities and cooperating with authorities when they request information, among other things.
The now troubled bank appears to have violated that agreement, according to a new report by the Senate Finance Committee that details ongoing and rampant abuse since then. The report, released Wednesday, details the findings of the panel's two-year investigation and takes on more urgency given the looming banking crisis. The Swiss National Bank injected more than $100 billion of liquidity into Credit Suisse to keep it afloat earlier this month, while the Swiss government agreed to provide UBS with some $9 billion to backstop losses resulting from the takeover.
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