Money-Laundering Case Involving Credit Suisse Finds the Bank Guilty

Switzerland’s Federal Criminal Court has found Credit Suisse and a former employee guilty of failing to prevent money laundering Money Laundering Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laund Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laund Read this Term. According to Reuters, during the period 2004 to 2008, the judges examined whether Credit Suisse and the former employee did enough to prevent alleged Bulgarian cocaine trafficking gang profits from being laundered through the bank.

The former employee and Credit Suisse denied wrongdoing. However, a court ruling on Monday found deficiencies within Credit Suisse both in the management of client relations with the criminal organization and in the monitoring of anti-money laundering compliance Compliance In finance, banking, investing, and insurance compliance refers to following the rules or orders set down by the government regulatory authority, either as providing a service or processing a transaction. Compliance concerning finance would also be a state of being following established guidelines or specifications. This designation can also encompass efforts to ensure that organizations are abiding by both industry regulations and government legislation. Understanding ComplianceCompliance is a In finance, banking, investing, and insurance compliance refers to following the rules or orders set down by the government regulatory authority, either as providing a service or processing a transaction. Compliance concerning finance would also be a state of being following established guidelines or specifications. This designation can also encompass efforts to ensure that organizations are abiding by both industry regulations and government legislation. Understanding ComplianceCompliance is a Read this Term.

There was testimony about murders and money stuffed into suitcases in the trial, seen as a test case for prosecutors looking to take tougher measures against the country’s banks in the future. Credit Suisse faces a fine of 2 million Swiss francs or $2.1 million approximately.

“Credit Suisse is continuously testing its anti-money laundering framework and has been strengthening it over time, in accordance with evolving regulatory standards. Generating compliant business growth in line with legal and regulatory requirements is key for Credit Suisse,” the bank commented.

The court said: “These deficiencies enabled the withdrawal of the criminal organization’s assets, which was the basis for the conviction of the bank’s former employee for qualified money laundering.”

In a statement, Credit Suisse said it would appeal the conviction, which was the result of a 14-year investigation.

Frozen Assets

In May, Credit Suisse froze CHF 10.4 billion of wealthy clients’ assets in the first quarter of 2022 under sanctions imposed in connection with Russia’s invasion of Ukraine.

“In Q1 2022, CHF 10.4 billion of assets under management were reclassified to assets under custody due to the imposed sanctions,” Credit Suisse commented. The bank’s financial report stated that the freezing of assets due to sanctions had an impact of CHF 10.4 billion on its wealth management assets. Moreover, less than 4% of the assets under management at the bank’s wealth management businesses are managed by Russians.