Credit Suisse Hid More Than $700 Million From Tax Authorities, Senate Finance Committee Says

(Photo by Fabrice COFFRINI / AFP) (Photo by FABRICE COFFRINI/AFP via Getty Images)

James Lynch Contributor
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Embattled Swiss financial giant Credit Suisse allegedly enabled wealth individuals to hide more than $700 million from the IRS, the Senate Finance Committee found in a report released on Wednesday.

Credit Suisse allegedly violated a 2014 plea deal with the Justice Department by failing to disclose a nearly $100 million transfer belonging to a family of U.S. and Latin American nationals from undisclosed accounts to other banks for nearly a decade, the report says. The bank potentially “enabled” criminal tax evasion to go undetected for nearly a decade by failing to notify the DOJ it was wiring these assets, according to the report. (RELATED: UBS Buys Credit Suisse For $2 Billion)

Former head of private banking for Latin America Alexander Siegenthaler was reportedly central to managing the family’s accounts, the report discovered. Siegenthaler supervised several Credit Suisse bankers who faced criminal charges and reported to the bank’s head of private banking for all the Americas.

The report also identified 23 “potentially undeclared accounts” belonging to ultra-wealthy American individuals each containing more than $20 million in assets, according to the report. More accounts could be uncovered as the investigation continues.

The report alleges that Credit Suisse employees knowingly helped businessman Dan Horsky conceal $220 million from U.S. authorities in offshore accounts, based on records received by the Senate Finance Committee. Horsky was sentenced to seven months in prison and ordered to pay a $100 million civil penalty for the scheme in February 2017, according to the Department of Justice.

“At the center of this investigation are greedy Swiss bankers and catnapping government regulators, and the result appears to be a massive, ongoing conspiracy to help ultra-wealthy U.S. citizens to evade taxes and rip off their fellow Americans,” Democratic Oregon Sen. Ron Wyden, Chair of the Senate Finance Committee, said in a press release.

“Credit Suisse got a discount on the penalty it faced in 2014 for enabling tax evasion because bank executives swore up and down they’d get out of the business of defrauding the United States. This investigation shows Credit Suisse did not make good on that promise, and the bank’s pending acquisition does not wipe the slate clean,” he added.

“Credit Suisse does not tolerate tax evasion. In its core, the report describes legacy issues, some from a decade ago, and we have implemented extensive enhancements since then to root out individuals who seek to conceal assets from tax authorities,” a company spokesperson said in a statement.

“Credit Suisse’s new leadership team has cooperated with the Committee’s inquiry and has supported the work of Senator Wyden, including in respect of suggested policy solutions to help strengthen the financial industry’s ability to detect undisclosed US persons. Our clear policy is to close undeclared accounts when identified, and to discipline any employee who fails to comply with bank policy or falls short of Credit Suisse’s standards of conduct. Credit Suisse is also actively cooperating with US authorities including the DOJ to address some remaining legacy conduct or policy concerns, and will continue to do so.”