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Credit Suisse Case May Be Easier for U.S. after UBS Negotiations Paved the Way
By Brian Monroe
printAfter over a year of negotiations with UBS AG, U.S. officials will have more leverage to reach a settlement with another Swiss bank that may have helped American citizens hide taxable assets. On Thursday, the U.S. Justice Department informed Credit Suisse Group AG that it was the subject of a probe related to its American accountholders. The investigation had been rumored since February, when federal prosecutors indicted four former bankers they said had helped Credit Suisse's clients avoid paying taxes on some $3 billion in assets. The probe into Switzerland's second largest bank follows the $780 million penalty paid in...
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Former UBS AG employee Stephanie Gibaud in 2008 was faced with the choice of whether to comply with her employer's request that she destroy records potentially indicating that the bank had courted tax-evading clients. When she refused, the bank psychologically bullied her until she departed in 2012.
Not long ago, U.S. settlements in the hundreds of millions of dollars for violations of American law by a foreign bank seemed unlikely, if not out of the realm of possibility altogether. Then came the $780 million deferred prosecution agreement with UBS AG in 2009.
Facing the possibility of stiff monetary settlements, several Swiss banks are threatening to seize funds from U.S. clients who refuse to declare their offshore accounts to the Internal Revenue Service.
Credit Suisse AG's guilty plea to charges that it hid clients' assets from U.S. tax collectors is likely to translate into more troubles for the institution, both here and abroad.
Credit Suisse is unlikely to turn over the names of some suspected tax cheats even if the United States adopts a pending bilateral tax agreement with Switzerland, bank representatives told lawmakers Wednesday.
A U.S.-Swiss plan to resolve a tax evasion dispute may absolve Switzerland's government from further action but will prove costly and time-consuming for participating banks, say attorneys.
In his 12-year career as an Assistant U.S. Attorney in the Southern District of New York, Daniel W. Levy has investigated and prosecuted several banks, bankers, and financial services advisors that facilitated the evasion of U.S. taxes through the use of complicit offshore financial institutions.
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The U.S. government will ask Credit Suisse to turn over information on more than 1,000 accountholders as part of an ongoing criminal tax probe, according to an individual familiar with the matter.
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Switzerland's largest bank will pay $780 million to the United States for helping 17,000 U.S. citizens evade paying taxes on offshore revenue, the U.S. Justice Department said Wednesday.