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Credit Suisse pleads guilty to helping 'tax cheats' Credit Suisse pleads guilty to helping 'tax cheats'
(35 minutes later)
The Swiss banking giant Credit Suisse has pleaded guilty to helping some US clients avoid paying taxes to the US government and agreed to pay a $2.6bn (£1.5bn) fine.The Swiss banking giant Credit Suisse has pleaded guilty to helping some US clients avoid paying taxes to the US government and agreed to pay a $2.6bn (£1.5bn) fine.
It is the biggest bank to plead guilty to criminal charges in the US in over 20 years. It is the biggest bank to plead guilty to criminal charges in the US in more than 20 years.
However, as part of the agreement with US regulators, the bank will not lose its banking license in the US. US attorney general Eric Holder said the bank helped US "tax cheats dodge US taxes".
Credit Suisse said in a statement it deeply regretted the past misconduct.Credit Suisse said in a statement it deeply regretted the past misconduct.
Chief executive Brady Dougan added that the bank had seen no impact on its business from "the heightened public attention on this issue in the past several weeks". The bank said the settlement would reduce its second-quarter net profit by 1.6bn Swiss Francs ($1.8bn; £1bn).
US attorney general Eric Holder said the bank engaged in an "extensive and wide ranging conspiracy" to help US "tax cheats dodge US taxes". However, as part of the agreement with US regulators, the bank will not lose its banking license in the US.
Long road 'Elaborate lengths'
A few weeks ago, Credit Suisse chairman Urs Rohner told shareholders in a letter that settling the charges was one of the "most pressing issues" facing the bank. "The bank went to elaborate lengths to shield itself, its employees, and the tax cheats it served from accountability for their criminal actions," said Mr Holder at a press conference.
However, Mr Rohner added that the US accounts in question accounted for less than 1% of the bank's total revenue. "They subverted disclosure requirements, destroyed bank records, and concealed transactions involving undeclared accounts by limiting withdrawal amounts and using offshore credit and debit cards to repatriate funds."
According to US media reports, neither Mr Rohner nor chief executive Brady Dougan are expected to lose their jobs as a result of the agreement. Mr Holder said the tax evasion schemes went back decades, saying that in one Credit Suisse entity, the practice of using sham entities began more than 100 years ago.
In February, a US Senate committee investigation alleged that Credit Suisse opened Swiss accounts for more than 22,000 US customers, with assets totalling $12bn at their peak. However, according to US media reports, neither Credit Suisse chairman Urs Rohner nor chief executive Brady Dougan are expected to lose their jobs as a result of the agreement.
US prosecutors are chasing more than a dozen other Swiss banks for allegedly helping wealthy Americans dodge US taxes. US authorities have already indicted eight Credit Suisse employees who helped clients evade taxes.
Credit Suisse is not alone. US prosecutors are chasing more than a dozen other Swiss banks for allegedly helping wealthy Americans dodge US taxes, and at the press conference, they hinted that there would be more settlements to come.
In 2009, another Swiss bank, UBS, settled similar charges with US regulators for $780m as well as an agreement in which the bank would give US authorities the names of its so-called "secret" account holders.In 2009, another Swiss bank, UBS, settled similar charges with US regulators for $780m as well as an agreement in which the bank would give US authorities the names of its so-called "secret" account holders.