Friday, January 24, 2014

Credit Suisse Settlement with DOJ May Top $800 Million (1/24/14)

According to Reuters, the Wall Street Journal is reporting that the Credit Suisse settlement may top $800 million.  See Katharina Bart and Oliver Hirt, Credit Suisse may agree $800 million U.S. tax settlement by July: WSJ (Reuters 1/23/14), here.  Excerpts:
U.S. authorities and Credit Suisse (CSGN.VX) could agree a settlement of more than $800 million by July for the Swiss bank's role in helping wealthy Americans dodge taxes, the Wall Street Journal reported on Thursday, citing unnamed sources. 
Credit Suisse is now the largest bank in a long-running U.S. crackdown on undeclared funds held in hidden offshore accounts, including in Switzerland. Scores of Swiss banks have offered to cooperate with U.S. authorities in order to avoid prosecution. 
* * * * 
Credit Suisse has said it is cooperating with prosecutors and keen to reach a deal and, although no indications have been given on the size of any settlement, the bank took a 295 million Swiss franc ($324 million) provision three years ago to pay expected fines and legal fees. 
The bank said in October it delivered "substantial, high-level" data on clients leaving, and is preparing to provide more specific information.


  1. While Democrats continue to rely heavily on using extortion to grab as much money as possible from foreign jurisdictions, the FINMA hut us burning down for yielding to US blackmail:

    "Raaflaubs US politics became a total disaster."

  2. Jack keep in mind that the 2/2009 $UBS settlement had a $/CHF of 1.1700isch (780 => 913CHF) now we are for $CS @ 0.89isch that is already a big difference.

    Btw insiders have expected $1Bil but if it were only 800 => 712CHF .... that would be over 22% less than UBS !! Even after the 12/2012 $1.5 Bil Libor settlement $UBS remains as one of the best capitalized banks in the world.

  3. Jack this is another real life experience about the consequences from FATCA for USPs living and working overseas - this time in Belgium : my husband's bank account was blocked and he couldnt use his card
    anymore. He went to his bank to see what the problem is. he thought
    maybe his card was not working right.
    At his bank they told him that
    they blocked his account and that he couldnt get his money. They got
    their orders to block all US citizens accounts until they can prove that
    they dont owe taxes to the US.
    At our other bank they told us the same thing. They will block our account because they also got their orders... We have to prove that we dont owe the US taxes....

    Jack this is shameful !

  4. Jack here is an excellent submission (Request for Tax Rule Changes) to the U.S. Senate Finance Committee.
    This was written by *Toronto lawyer John Richardson, ***University of Toronto professor Dr. Stephen Kish and (this is huge!) **U.S. attorney Willard Yates. Mr. Yates’ involvement is significant because he retired from Office of Associate Chief Counsel (International) (ACCI), Internal Revenue Service after 31 years of service.

  5. The stumbling block between US-Russia info sharing is that few Americans (except those living and working in Russia) need or want a Russian bank account, whereas for Russians with money (whether ill-gotten or simply because of recent memories of the USSR) the US is an attractive place to bank. So I would expect strong opposition from US banks against such an agreement.

  6. hello Jack, here is another "real life" consequence of FATCA
    Article in the WSJ:

    Noted one of the comments:
    US Citizen considering renouncing wrote:
    After working hard overseas for decades, filing and paying taxes every
    single year, I was rewarded by the US government with a big slap on the
    face. I was recently promoted to General Manager, and was offered a 10%
    partnership with rights to buy another 10% (mid size company). When the
    partners (company is mostly owned by a financial institution as an
    investor only) found about that:

    - me having signatory powers on the company’s bank accounts; and

    - owning 10% or more of the company

    will expose the company to certain IRS requirements…. they pulled the plug on me.

    My wife & I are considering renouncing our US citizenship. This is
    easily said than done; the pain that comes from simply having to
    consider this option is intolerable.

    What else can we do? We have kids to provide for, and a lifestyle that we
    love and will defend. We have come to realize that being successful,
    honest and law abiding american citizens living abroad are grounds for
    us to be punished by our own government.

  7. Sorry Jack but DeVere CEO Backs FATCA Repeal as well.

    This hits the nail right on the head. Now that the Republican Party has officially endorsed FATCA repeal, momentum is shifting. National governments should not sign IGAs and subject themselves to an American law that even the US Department of Justice admits has no legal authority over them, and can only be backed up with the threat of reprisal.

    The prospect of FATCA's repeal is quite realistic. If institutions help educate and inform the American public and Congress, there’s a good chance Fatca can be delayed and perhaps – I hope – eventually repealed. If banks, credit union, pension funds, stock and hedge funds, spent a tiny fraction of the money they'd spend for FATCA compliance on securing its repeal, that goal is achievable.

  8. Thanks for your comments. Whether or not FATCA is right or wrong in any objective sense, I don't think it will be repealed.

    Jack Townsend


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