Credit Suisse Services, a unit of the Swiss banking giant, has pleaded guilty to US charges for helping ultra-wealthy Americans evade taxes. The unit agreed to pay US$510,608,909 (S$658.87 million) in penalties, restitution, forfeiture, and fines, Channel News Asia reported, citing a press release from the US Department of Justice on Monday (May 5).
The bank was sentenced for conspiring to conceal over US$4 billion from the US Internal Revenue Service (IRS) across at least 475 offshore accounts, which were maintained by the Swiss bank in Singapore on behalf of US taxpayers using offshore accounts to evade US taxes and reporting requirements.
The Justice Department said that Credit Suisse’s bankers falsified records, processed fictitious donation paperwork, and handled over US$1 billion in accounts without documentation of tax compliance.
“In doing so, Credit Suisse AG committed new crimes and breached its May 2014 plea agreement with the United States,” it stated.
In 2014, the bank also agreed to pay a US$2.5 billion fine after pleading guilty to a US criminal charge for assisting Americans in evading taxes over several decades.
Before the settlement on Monday, a 2023 report from the US Senate Finance Committee found that Credit Suisse had violated its 2014 agreement by continuing to facilitate tax evasion and conceal more than US$700 million from the government.
CNA reported that the Swiss bank’s unit pleaded guilty to one count of conspiracy to aid and assist in the preparation of false income tax returns, UBS said.
UBS, which acquired Credit Suisse in 2023, said it had no involvement in the underlying conduct, which took place before it acquired the bank.
The Swiss lender had already accounted for the issue as a contingent liability during the acquisition and expects part of it to be released as a credit in the second quarter. At the same time, the bank anticipates recording a charge related to the payment in that quarter.
Credit Suisse Services has also entered a non-prosecution agreement, which requires the company and its parent firm, UBS, to cooperate with further investigations. They must also disclose any additional information about US-related accounts that may be uncovered in the future. /TISG
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