As previously disclosed, Credit Suisse has been responding to requests for information, including subpoenas, in an investigation by the US Department of Justice (DoJ) and other US authorities. The investigation concerns historical Private Banking services provided on a cross-border basis to US persons. As part of this process, on July 14, 2011, Credit Suisse received a letter notifying it that it is a target of the DoJ investigation. It has been reported that the US authorities are conducting a broader industry inquiry. Subject to our Swiss legal obligations, we will continue to cooperate with the US authorities in an effort to resolve these matters.Comments:
1. Credit Suisse acknowledges that it has been cooperating previously. The devil, of course, is in the details of its cooperation which are yet to emerge. The press release does say that it's cooperation is subject to Swiss legal obligations.
2. In measuring the Swiss Legal obligations, readers should review Federal Tax Crimes blog Swiss Court OKs UBS Initial Turnover of 255 U.S. Depositor Information (7/16/11).
3. Jeff Neiman, a key early player in the Government's offshore bank initiative against UBS who has since entered private practice, notes in his blog titled Credit Suisse Confirms Target Status (7/15/11):
From UBS, we know the DOJ will not agree to a resolution short of pleading guilty to a criminal indictment without complete cooperation. DOJ will most likely require the production of client names as part of Credit Suisse’s complete cooperation. Will Credit Suisse budge? Time will tell, but the Swiss high court recently said that when a bank faces “serious and virtually uncontrollable economic repercussions” they can turn over client names and not violate Swiss secrecy. [The reference is to item #2 above.]Other Reports:
US Probes Credit Suisse for Aiding Tax Evasion, Reuters 7/15/11. (The article also has a good summary of recent developments on the Swiss front.)
Chris V. Nicholson, Credit Suisse Discloses U.S. Inquiry Into Private Banking (NYT DealBook 7/15/11).
This blog was substantially revised on 7/16/11.