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Credit Suisse AG has agreed to pay $2.6 billion in penalties and pleaded guilty to helping Americans cheat on their taxes, according to a report by Bloomberg News, making it the first global bank in a decade to admit to a crime in a U.S. courtroom.
Attorney General Eric Holder said during a press conference that, “This case shows that no financial institution, no matter its size or global reach, is above the law.” According to Bloomberg News, Eric Holder also said that, “a company’s profitability or market share can never and will never be used as a shield from prosecution or penalty. And this action should put that misguided notion definitively to rest.”
According to the government, The Credit Suisse case involves tax evasion by U.S. clients that dates back decades. CNN Money reported that, Credit Suisse bankers used interesting ways to help their clients hide money in offshore accounts. The bank allegedly opened a branch at the Zurich airport, equipped with a special elevator to whisk clients to private banking suites. The arrangement allowed customers to do their banking quickly before hitting the Alpine ski slopes.
The firm reported that the deal will cut second-quarter earnings by 1.6 billion francs ($1.79 billion). The bank will pay $1.8 billion to the U.S., which includes almost $670 million in restitution to the Internal Revenue Service. The penalty also involves a $715 million payment to New York’s Department of Financial Services and $100 million to the Federal Reserve, according to Bloomberg News.
Credit Suisse Group AG Chief Executive Officer Brady Dougan, said in a statement that, “We can now focus on the future and give our full attention to executing our strategy,” and that We have seen no material impact on our business resulting from the heightened public attention on this issue in the past several weeks.”
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This settlement marks a major U.S. legal victory in a continuing U.S. investigation of approximately a dozen other Swiss banks on suspicion of similar tax-evasion-related wrongdoing to lure American clients.
Image credit: www.bbc.com
