Swiss regulator escalates probe into Credit Suisse

by
Swissinfo
My articles My booksMy videos
Follow on:TwitterFacebookGoogle +

After appointing an auditor last December, FINMA decided to open so-called enforcement proceedings. © Keystone/Lukas Lehmann

The Swiss financial supervisor FINMA says it has opened enforcement proceedings against Credit Suisse into the 2019 spying affair that toppled the bank’s leadership and tarnished its reputation.

FINMA opened the proceedings after an auditor appointed last December completed its investigation of Credit Suisse, which has acknowledged surveillance activities against former wealth management boss Iqbal Khan (now at the rival UBS bank) as well as former human resources head Peter Goerke.

“FINMA … will pursue indications of violations of supervisory law in the context of the bank’s observation and security activities and in particular the question of how these activities were documented and controlled,” the watchdog said in a statement on Wednesday. The probe is expected to last several months.

Ex-chief executive officer Tidjane Thiam resigned in February in the case that roiled Zurich’s banking scene, contending that he knew nothing of the spying activities but acknowledging that it caused anxiety and pain.

The regulator can demand that banks improve their compliance and internal supervision systems if they are found to be lacking – as it has done with other banks in the past.

FINMA cannot issue fines but can demand that guilty parties surrender illicitly gained funds. It has the ultimate sanction of suspending or revoking licenses for individuals or institutions to operate in Switzerland, but only does so in the most extreme cases of market abuse.

In response to FINMA’s enforcement proceedings, Credit Suisse said it would cooperate “to ensure a complete and expeditious conclusion of the review of this episode and incorporate lessons learned.”

Credit Suisse reiterated previous statements that spying on its employees was not part of its culture.

The bank’s own internal probe, carried out by a Zurich law firm last year, had found then-chief operating officer Pierre-Olivier Bouée initiated spying on Khan, who had led Credit Suisse’s wealth management activities.

It included pursuing Khan through the streets of Zurich to see if he was trying to poach former colleagues to join him at UBS. Bouée was forced to resign for his part in the scandal.

Zurich prosecutors have also opened a criminal investigation into the spying allegations that resulted in a Credit Suisse contractor taking his own life.

You Might Also Like

Motorway station supplier goes into liquidation

A company that supplies Swiss motorway service stations and convenience stores has gone into liquidation after failing to find new investors. Some 144 jobs at Lekkerland Switzerland are now at risk of disappearing by the end of the year.

Swiss humanitarian trade deal with Iran faces delay, questions 

Swiss “good offices” between Tehran and Washington have brought about a humanitarian aid channel allowing Swiss-based companies to send medicines and other vital goods to Iran despite US sanctions. But it remains to be seen to what extent the now-delayed deal will help the Iranian people versus Swiss political and economic interests. 

Temporary employee sector hit hard by Covid-19 crisis

The number of hours worked by temporary employees in Switzerland has dropped by about 23% due to the impact of restrictions imposed in the wake of the Covid-19 pandemic.

Switzerland’s dark business with Ukrainian coal

Pro-Russian separatists are financing their war in Ukraine with coal deliveries to the West. Now the role of Swiss companies in Zug and Geneva is being investigated, according to a report in the SonntagsZeitung. 

Swiss luxury watch retailer Bucherer to shed jobs

The leading Swiss luxury watch and jewellery company Bucherer has announced it plans to slash 370 of its 2,400 jobs worldwide due to the coronavirus crisis hitting tourism.

Banks braced as pandemic poses biggest test since financial crisis

During the depths of the coronavirus crisis in Europe in late March, Sergio Ermotti remembers sitting in his home study in Lugano, reflecting on the latest financial meltdown to engulf his career as a banker.

Swiss Private Banks Brace for Coronavirus Impact

The Swiss private banking sector saw a resurgence in fortunes last year but faces an uncertain future as the Covid-19 pandemic continues to play havoc with financial markets. Favourable market conditions in 2019 allowed the 84 banks surveyed by KPMG to grow client assets by 14%, according to a recently published report by the audit firm.

Chinese-owned Swissport agrees emergency takeover

A consortium of investors has agreed a €800 million (CHF860 million) bailout of Chinese-owned airport services company Swissport. Revenues at the company have nosedived since the onset of the coronavirus pandemic.