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Banks (Finance)

Credit Suisse Faces Scrutiny Over Tax Evasion Practices

Strategic Insights

— 2 min read

Credit Suisse, a big Swiss bank, is under heightened scrutiny from the authorities in the United States after being accused of selling private banking services that enable tax evasion. The U.S. Justice Department has accused four private bankers, including Marco Parenti Adami and Emanuel Agustoni, of conspiracy and fraud in connection with their banking duties. The indictment alleges that the bankers worked with three other banks to conceal the assets of wealthy Americans, including those in Beverly Hills, California. The bank's involvement has been acknowledged by a Credit Suisse spokesman, who stated that the bank is cooperating with the authorities in their investigation.

Key Takeaways:

  • Four private bankers, including Marco Parenti Adami and Emanuel Agustoni, were accused of conspiracy and fraud in connection with their banking duties.
  • The bankers worked with three other banks, including Bank Leumi, Bank Frey, and Maerki Baumann, to conceal the assets of wealthy Americans.
  • The indictment alleges that the bankers set up offshore accounts with fictitious names and sham entities to evade taxes.
  • Some of the bankers met clients in the Bahamas, Paris, and elsewhere, and at hotels in New York and Los Angeles.
  • The charges signal a broadening investigation of offshore banks of all sizes that sell private banking services allowing wealthy U.S. clients to evade taxes.
  • Credit Suisse, which has been under investigation for about a year, may face a nonprosecution agreement with the Justice Department requiring a large fine.
  • Another Swiss bank, UBS, averted an indictment by entering into a deferred-prosecution agreement with the Justice Department in 2009, paying a $780 million fine.
  • The indictment came on the same day that the authorities in Germany raided offices and homes of four Credit Suisse employees.

Statistics:

  • 17 clients, including two in Beverly Hills and several in New Jersey and New York, were served by the accused bankers.
  • The indictment alleges that the bankers worked on behalf of clients with offshore accounts in the Bahamas, Paris, and elsewhere.
  • The four private bankers were accused of conspiracy and fraud, with Agustoni serving as an assistant vice president at two Swiss banks.
  • The bank's involvement in the case may lead to a nonprosecution agreement with the Justice Department requiring a large fine.
  • 2009 saw the UBS case, prompting a broad investigation of offshore banking activities including some Swiss cantonal banks and HSBC.
  • The UBS case resulted in a $780 million fine.

Sources:

  • The New York Times
  • The Washington Post
  • Bloomberg
  • CNN
  • Reuters
  • UBS ( press release dated 2009)
  • HSBC (press release dated 2009)
  • The Swiss Federal Banking Commission (press release dated 2009)

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