U.S. justice officials are promising a tougher tack on corporate wrong-doers. Credit Suisse is likely to be in focus.
The Department of Justice is preparing to unleash a series of actions on some of the largest companies doing business in the U.S. in coming weeks, DoJ official John Carlin told the «Financial Times» (behind paywall) on Wednesday.
Specifically, he noted that the DoJ is interested in pursuing companies which have breached their so-called deferred prosecution agreements, or DPAs. These deals are struck to settle criminal charges in mutual agreement without a trial.
Revisit Of 2014 Deal
The stance which is likely a cause for worry at Credit Suisse: the DoJ last week disclosed it is revisiting the Swiss bank’s $2.5 billion tax deal from seven years ago, in a court filing reported by «Bloomberg».
A spokesman for the Swiss bank said «Credit Suisse has and continues to cooperate with U.S. authorities in connection with its ongoing obligations under the 2014 settlement. Credit Suisse takes those obligations seriously.»
Whistleblower's Charges
Previously, a whistleblower accused Credit Suisse of failing to report an $200 million account held by a wealthy Israeli-American professor, Dan Horsky, despite its 2014 DPA. It isn’t clear whether the Horsky accounts spurred the DoJ to review Credit Suisse’s DPA.
Credit Suisse is currently subject to a new DPA, stretching three years, after last month pleading guilty to conspiracy for its role in enabling corruption in Mozambique. The repeated scandals represent additional worry for Chairman António Horta-Osório, who is seeking a turnaround of the Zurich bank.
U.S. Scare-Mongering
While Carlin of the DoJ disclosed no specifics to the «FT», the scare-mongering is likely to spark wider Swiss interest: countless banks and financial providers have reached DPAs to settle everything from helping tax fraud to rigging interest rates or precious metals markets.
In September, a U.S. district court indicted six Swiss bankers in a tax crackdown. The bank tied to the indictment – Ihag in Zurich – is one of nearly 100 in Switzerland that were corralled into non-prosecution agreements between 2013 and 2014.
