The bank, which is now owned by rival UBS, enabled US customers to evade their tax obligations in a number of ways including:

• opening and maintaining at least 475 undeclared offshore accounts;
• providing banking services that assisted in the concealment of assets and income from the IRS; and
• facilitating their failure to file the requisite FBARs (FinCEN Form 114).

Credit Suisse bankers falsified records, processed fictitious donation paperwork and serviced more than $1 billion in accounts that did not have “documentation of tax compliance.”

These actions all took place between 2010 and continued until 2021, which means that the bank also breached its 2014 plea agreement with the US authorities. That agreement involved the bank paying a record $2.6 billi0n to settle the case against it.

The bank’s Singapore branch also held over $2 billion of assets in undeclared accounts for customers, despite the fact that it knew or at least should have known that they were US citizens. Staff in Singapore failed to adequately identify the beneficial owners or the accounts or conduct adequate inquiries into US “indicia” in the accounts.

Singapore connection

The shortcomings in Singapore were only identified after the merger between Credit Suisse and UBS when the latter became aware of these accounts. To its credit UBS moved swiftly by launching its own investigation while disclosing the identified accounts to the DOJ and freezing some of these.

The settlement with the US DOJ follows a “lengthy” investigation by US law enforcement and involves a non-prosecution agreement (NPA) between Credit Suisse, the Justice Department’s Tax Division and US Attorney’s Office for the Eastern District of Virginia. As part of the agreement Credit Suisse has agreed to cooperate with the investigation, which is ongoing. The plea does not include any protections for any of the individuals involved in the malfeasance.

In its statement announcing the settlement UBS highlighted the “legacy” nature of the business, which “began before UBS acquired Credit Suisse” and pointed out that “UBS was not involved in the underlying conduct and has zero tolerance for tax evasion.”