Credit Suisse Deal to Settle Tax Probe Could Top $2 Billion

Credit Suisse deal with U.S. authorities could top $2 bln-sources
Anja Niedringhaus/APCredit Suisse Group Chairman Urs Rohner
By Karen Freifeld
and Aruna Viswanatha


NEW YORK and WASHINGTON -- New York state's banking regulator is seeking hundreds of millions of dollars from Credit Suisse (CS) in its probe of potential tax evasion involving the Swiss bank, according to sources close to the matter, which could push an eventual settlement with U.S. authorities to over $2 billion.

The New York regulator made an opening bid of $1 billion, one of the sources said, though negotiations are expected to significantly drive down the final penalty amount.

The settlement with the New York State Department of Financial Services would be in addition to the fine that Credit Suisse is discussing with the U.S. Justice Department. Reuters reported last week that the Justice Department is seeking as much as $1.6 billion from the bank.

The talks between Credit Suisse and Benjamin Lawsky, New York's financial services superintendent, are ongoing, people familiar with the matter said. Credit Suisse could reach a deal with New York and federal authorities in the coming days, they said.

Federal prosecutors have also been pushing for the bank to plead guilty to criminal charges as part of the settlement, as the U.S. Justice Department has faced criticism that it has shied away from prosecuting financial firms.

Spokesmen from Credit Suisse and Lawsky's office declined comment.

The Swiss bank is eager to move past the long-running probe by the Justice Department into whether it helped thousands of Americans evade U.S. taxes.

Credit Suisse Chairman Urs Rohner told shareholders last week, "We are doing everything we can to resolve this matter within the given framework of U.S. and Swiss law, in the best possible way and in a timely manner."

New York authorities opened their investigation earlier this year in the wake of a damning U.S. Senate report that accused Credit Suisse bankers of secretly traveling to the United States to recruit clients.

The Senate report said Credit Suisse's practices facilitated tax evasion against the United States for years. By 2008 the bank had more than 1,800 Swiss bankers who were handling one or more U.S. clients, according to the report.

In total Credit Suisse opened Swiss accounts for more than 22,000 U.S. customers with combined assets of as much as $12 billion, the report said.

In April the Lawsky's office ordered Credit Suisse to turn over employment and other records as it examined whether the bank lied to New York authorities about creating tax shelters.

The bank agreed in February to pay $196 million to resolve a related case from the U.S. Securities and Exchange Commission.


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22 Comments

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bettybrocksbaby

They need to post a list of the criminals. I bet the Clintoons and Bushies would top the list, birds of a corrupt feather stick together!

May 14 2014 at 10:33 AM Report abuse -2 rate up rate down Reply
1 reply to bettybrocksbaby's comment
clark8642

Maybe, although I have seen no evidence. On the other hand it looks like Karl Rove may be in trouble.
http://www.washingtonpost.com/politics/crossroads-gps-likely-broke-election-law-fec-staff-reports-concluded/2014/01/15/15af18b6-7d73-11e3-93c1-0e888170b723_story.html

May 14 2014 at 11:37 PM Report abuse rate up rate down Reply
Michael Corn

We put those who kill our children with drugs in jail. Why not those who defraud the taxpayer? These schemes need to part of a war on the rich and the corporations

May 14 2014 at 1:15 AM Report abuse +1 rate up rate down Reply
JGSHIRES

THE THINGS UNITED STATES SPENDS OUR MONEY ON IS CRAZY AND STUPID.
I AGREE CHEAT THE TAX SYSTEM. I NEED TO LOOK INTO A SWISS BANK ACCOUNT.

May 13 2014 at 10:50 PM Report abuse -7 rate up rate down Reply
1 reply to JGSHIRES's comment
hgeorgech

With your whopping $3.14 to invest ???

If you had major bucks, you'd already have such accounts !

May 14 2014 at 5:36 AM Report abuse +2 rate up rate down Reply
chemconst

I truly do not understand.

Every citizen in this country, except bankers & wall street people, go to jail for breaking the law.

What is Going On In This Country?


www.HarrisHelps.org

May 13 2014 at 10:48 PM Report abuse rate up rate down Reply
atokageneral

...got a list of patrons?

May 13 2014 at 10:38 PM Report abuse +1 rate up rate down Reply
Stephen

There needs to be some type of a penalty system that terminates the employment of all the corporate officers and others who were aware of the infraction; terminates the "employment" of the Board of Directors, and completely restructures the organization….in addition to a fine equal to 50% of its profits… for any bank or financial institution that cannot follow the law. Let it happen a few times..and maybe these people will start getting the message. In the case of Credit Suisse…expel them from doing business within the United States.

May 13 2014 at 10:26 PM Report abuse +3 rate up rate down Reply
1 reply to Stephen's comment
Michael Corn

Unfortunately they write the laws to protect themselves

and buy our policitical system and our supreme court.

May 14 2014 at 1:17 AM Report abuse +2 rate up rate down Reply
Neil

Two billion in fines, twelve billion in assets. Do the math, not a bad business decision. This Business Model will continue until the fines turn this Model into a complete financial loss and essentially unworkable. Perhaps the fines should be Fourteen Billion. Then everyone will begin too think twice about full Capital loss by the Bank and its Customers...

May 13 2014 at 7:32 PM Report abuse +5 rate up rate down Reply
1 reply to Neil's comment
clark8642

Imagine the taxes, penalties and fines on those 22,000 cheats. I look forward to seeing a list of all the cheats.

May 13 2014 at 7:45 PM Report abuse +4 rate up rate down Reply
clark8642

How about we see the names of those US citizens who participated in the fraud and stole from the rest of us?

May 13 2014 at 6:06 PM Report abuse rate up rate down Reply
EzinWy

If governments wouldn't lie, cheat, and steal, the world might be a better place ...

May 13 2014 at 4:57 PM Report abuse rate up rate down Reply
Jim Craigs

They are ALL THIEVES

May 13 2014 at 4:55 PM Report abuse rate up rate down Reply