Credit Suisse pleads guilty to US tax evasion
Credit Suisse has pleaded guilty to help Americans evade taxes, it has now agreed with the US government on a financial settlement involving a total of $1.8bn fine the form of a fine of over $1.13bn and nearly $670m in restitution to the IRS.
It is the second bank to be fined for tax evasion, following a deferred prosecution agreement for UBS, which paid a significantly lower fine of $780m for similar charges.
The settlement has been reached as part of increased efforts by US authorities to crack down on tax avoidance using the recently signed FATCA agreement between Switzerland and the US.
It will reduce Credit Suisse’s second quarter net income by CHF 1,598m. If the charge arising from the settlement had been applied at the end of the first quarter 2014, its look-through Basel III CET1 ratio would have been 9.3%, rather than 10.0%.
Commenting on the implications of the fine, Brady Dougan, CEO of Credit Suisse stressed: “We deeply regret the past misconduct that led to this settlement. The US cross-border matter represented the most significant and longstanding regulatory and litigation issue for Credit Suisse. Having this matter fully resolved is an important step forward for us.”
Following the resolution, Credit Suisse expects no impact on its licenses, nor any material impact on its operational or business capabilities.