Credit Suisse parted ways with its long-time U.S. overseer just over a year ago. Neil Barofsky is now back at the bank, now a UBS subsidiary, after a U.S. Senate investigation.
Credit Suisse has reinstated Neil Barofsky as an independent ombudsman to investigate accounts with alleged Nazi links at the UBS subsidiary, according to a report by news agency «Reuters» in reference to a statement from a U.S. Senate committee.
«Inexplicably» Terminated
In November 2022, the bank, already in dire straits at that time, announced the termination of its collaboration with the ombudsman who had been assigned by the U.S. authorities. A rift had emerged, with Credit Suisse apparently accusing Barofsky of making unsubstantiated claims in the report on the suspected Nazi funds at the bank.
In turn, the former prosecutor accused the bank of hindering the investigation into the issue.
Last August, U.S. senators (german only) also accused Credit Suisse of not considering all relevant documents in the investigation of historical bank transactions with alleged Nazi links. The U.S. parliamentarians have now apparently asserted their position. A Senate investigation has found that the bank hindered Barofsky’s investigations in the issue and «inexplicably» terminated him.
High Costs
As a result, Barofsky is back at Credit Suisse, where he was originally appointed by the New York financial regulator after Credit Suisse was found guilty in the tax dispute with the U.S. In the aftermath the banking giant had to pay a fine of 2.6 billion Swiss francs in 2014.
The former U.S. prosecutor worked with a large team of specialists, sometimes numbering over 100, whose compensation cost Credit Suisse dozens of millions of dollars per quarter.
Long Past the Term
Barofsky and his team combed through the major bank’s archives and stayed in his role well beyond the maximum term of two years. He also got involved in the legal dispute with the USA on compensation for toxic sub-prime loans and in 2021 was tasked by Credit Suisse to investigate alleged Nazi funds.
