Sunday, July 24, 2011

Credit Suisse, Bank Sarasin and Julius Baer in the News (7/24/11; 7/27/11)

Reuters reports that there is little appetite in the Swiss Government to help Credit Suisse avoid the U.S. juggernaut the way it assisted UBS by authorizing turnover of information and documents on U.S. depositors.

The report also says that "The [U.S.] investigation against Credit Suisse has also prompted Swiss private banks Bank Sarasin and Julius Baer to ban staff from travelling to the United States." Bank Sarasin spokesman is quoted as saying: "It's about protection. So the bank and its employees will be protected from investigations and arrests."

Reuters Report: Credit Suisse unlikely to get help over U.S tax probe (Reuters 7/24/11).

Addendum 7/27/11:  A commenter posted this article: Marie-Christine Bonzom in Washington, Credit Suisse “worse off” than UBS in the US, ( 7/27/11).  The author of the article paints a gloomy picture for Credit Suisse.  Among the items covered are:
“The very serious allegations against Credit Suisse relate to a wider range of conduct extending beyond a tax conspiracy into a broader range of criminal activity,” Michel of the Washington firm Caplin & Drysdale told
“These are not just allegations that a Swiss bank opened accounts that they knew would not be reported to the IRS [Internal Revenue Service], there are also allegations that employees of the bank lied to the Federal Reserve, engaged in destruction of records, helped people try and evade DOJ [Department of Justice] investigation and provided unlicensed banking services to customers,” the lawyer representing some 30 Credit Suisse clients said.
* * * *
Michel, along with Lawrence Horn of the firm Sills, Cummis & Gross in Newark, interpret the measures taken in the past week by the US authorities as pointing to the imminent indictment of the bank itself.

“Credit Suisse is on the verge of being indicted, unless the bank negotiates with DOJ and gives names of its American depositors,” Michel said.

The letter sent to Credit Suisse is known in legal jargon as a target letter, and its meaning is clear, according to Horn. “It means that the Department of Justice has enough evidence to indict you”.
* * * *

Faced with this unfavourable climate and at risk of losing its US licence if indicted, it is in the bank’s interest to cooperate and make amends honourably, the lawyers say.

As Horn predicts: “Credit Suisse will go the way of UBS, it will enter into a deferred prosecution agreement, it will pay millions of dollars in fines and it will turn over a number of its American depositors.”

“There’s no escape for Credit Suisse because it wants to continue to do business in the United States,” he added.


  1. The New Colossus
    Emma Lazarus

    Not like the brazen giant of Greek fame,
    With conquering limbs astride from land to land;
    Here at our sea-washed, sunset gates shall stand
    A mighty woman with a torch, whose flame
    Is the imprisoned lightning, and her name
    Mother of Exiles. From her beacon-hand
    Glows world-wide welcome; her mild eyes command
    The air-bridged harbor that twin cities frame.
    "Keep ancient lands, your storied pomp!" cries she
    With silent lips. "Give me your tired, your poor,
    Your huddled masses yearning to breathe free,
    The wretched refuse of your teeming shore.
    Send these, the homeless, tempest-tost to me,
    I lift my lamp beside the golden door!"

  2. Bring us your Swiss enablers yearning to be locked up!

  3. I have a great deal of respect for Scott Michel.

    As I see it, Credit Suisse is a "putative Defendant".

  4. This is slightly off topic but I have just started reading about this FBAR filing requirement and have a question. I was a student for >5 years in the US (PhD program), graduated last year and have taken up a job and moved outside the US. I opened a bank account -after- leaving the US to get my salary and it obviously ended up having >10k in it. Do I have to report it in a FBAR as I was never a US resident while it was open? I really need to know this as I only have another foreign account and it has less than $500 in it (it has been open for many years), so I have no filing requirement if I can exclude this account.

    Some points which may be relevant :
    1. Since I was a student for more than 5 years, I was a dual status alien last year.
    2. I never knew about FBAR when I was in the US.
    3. I was a non-immigrant - I did not even apply for a US job as I never had any intention of living in the US for longer than necessary to get my degree.

  5. If the below article is correct, DOJ/IRS are asking for a lot of U.S. person account information from Switzerland. It says they want details on all accounts valued 50k or higher from 2002 - 2010. That is likely a bunch of accounts.


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