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Credit Suisse has agreed to pay $511 million and plead guilty to helping American taxpayers hide more than $4 billion from authorities under an agreement with the US Department of Justice. This admission comes after the bank violated a deal struck a decade ago for similar reasons.
Following an emergency rescue in 2023, UBS, which acquired Credit Suisse, announced that Credit Suisse Services would pay two fines totaling just over half a billion dollars. These fines include $372 million for assisting in the preparation of false income tax returns and almost $139 million as part of a non-prosecution agreement regarding US taxpayers with accounts in its legacy Singapore booking center.
UBS, emphasizing its zero tolerance for tax evasion, stated that it was not involved in the underlying conduct. The bank had entered its own $780 million settlement with US prosecutors in 2009 over similar conduct. As the successor company to Credit Suisse, UBS executives signed the plea agreement with prosecutors filed in federal court in Virginia on Monday and appeared in court on behalf of the company to enter the guilty plea.
The plea agreement marks the end of a lengthy investigation by the DoJ, which revealed that Credit Suisse helped Americans conceal assets and income from the Internal Revenue Service in at least 475 offshore accounts. This misconduct breached a 2014 plea agreement struck by the lender with US authorities.
The DoJ stated, “Among other fraudulent acts, bankers at Credit Suisse falsified records, processed fictitious donation paperwork, and serviced more than $1 billion in accounts without documentation of tax compliance.”
In 2014, Credit Suisse agreed to pay $2.6 billion, the highest payment in a DoJ criminal tax case at the time, for assisting US taxpayers in filing false returns. Additionally, the bank entered into an agreement on Monday to avoid prosecution in relation to accounts it held in Singapore on behalf of US clients evading taxes. The total assets in these accounts, maintained between 2014 and 2023, amounted to more than $2 billion, according to the DoJ.
UBS discovered undeclared US accounts in Singapore after merging with Credit Suisse and later disclosed information about them to the DoJ, as per federal prosecutors. Under the settlement agreements, which do not shield individuals, Credit Suisse Services and UBS must cooperate with the DoJ’s ongoing probes.
The settlement follows a 2023 report by the US Senate Committee, which found that Credit Suisse had aided ultra-wealthy Americans in evading taxes and failed to report nearly $100 million in secret offshore accounts belonging to a single family of US taxpayers. Former Credit Suisse employees, who initially reported the bank’s illegal activities, triggered the investigation by revealing that the tax evasion continued “well after the plea agreement and sentencing.”
