Credit Suisse to Defend $45M Penalty Order in Swiss Court

Swiss federal prosecutors are seeking around 42.4 million Swiss francs ($45 million) in penalties from Credit Suisse for its involvement in serious anti-money laundering breaches. The trial against the investment banking giant will start on February 7, the Swiss Federal Criminal Court (FCC) confirmed on Monday.

The allegations against the Swiss bank first came to light in an indictment in December 2020 were related to a 14-year-old investigation into the activities of a Bulgarian narcotic crime ring. Led by a top-level wrestler, the criminal organization deposited around 55 million francs at Credit Suisse.

In the latest 500-page document submitted to the Swiss federal criminal court, the prosecutors pointed out ‘serious organizational shortcomings’ on the part of the bank in combating money laundering. Additionally, the prosecutors charged one of its former employees for her involvement.

The Office of the Attorney General is seeking compensation of around 34.8 million Swiss francs as well as additional compensation of around 7.6 million francs from Credit Suisse AG from the bank for the lapses.

The Bank Will Defend Itself

However, Credit Suisse rejected all of the allegations. “[The bank] unreservedly rejects as meritless all allegations in this legacy matter raised against it and is convinced that its former employee is innocent,” it said in a statement. “The bank will defend itself vigorously in court.”

Credit Suisse is the second-largest bank in Switzerland but is tainted with controversies. A unit of the Swiss bank Credit Suisse was fined $9 million by FINRA earlier this month following another $475 million penalties by the SEC last October.

Meanwhile, the Swiss company announced its plans to side an additional 500 million francs for litigation. The financial position of the bank is in the doldrums due to losses it incurred with the collapse of Archegos Capital Management and Greensill Capital.