Credit Suisse has pleaded guilty to criminal charges and agreed to pay $1.8bn fine to the US by 28 November 2014 as part of an investigation into allegations that the bank assisted wealthy Americans avoid paying taxes.
Under the plea agreement, Credit Suisse will pay a total of approximately $2.6bn with several government authorities, including $1.8bn in a criminal fine and restitution, $100m to the Federal Reserve and $715m to the New York State Department of Financial Services.
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The guilty plea was accepted by Chief Judge Rebecca Beach Smith of the federal court in Norfolk, Virginia.
The investigations into Credit Suisse’s practices have produced indictments of seven Credit Suisse employees, the owner of a trust company and a number of the bank’s US clients.
Credit Suisse has been accused of operating an illegal cross-border banking business that assisted thousands of US clients in opening and maintaining undeclared accounts and concealing their offshore assets and income from the IRS.
As part of the agreement, Credit Suisse has agreed to make a complete disclosure of its cross-border activities, cooperate in treaty requests for account information, and provide complete information as to other banks that transferred funds into secret accounts.
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By GlobalDataAdditionally, Credit Suisse has also agreed to implement programs to ensure its compliance with US laws, including the Foreign Account Tax Compliance Act and relevant tax treaties.
General Cole, deputy attorney of the US, said: "As we expand our offshore investigations, not just in Switzerland, but around the world, the message to banks who engaged in these crimes is clear step forward, accept responsibility for your past conduct, and help us hold responsible the US taxpayers who benefitted, and the individuals who assisted them."
Larry Wszalek, acting deputy assistant attorney general for the Justice Department’s tax division, said: "The Justice Department will continue to vigorously pursue our global enforcement efforts against individuals who avoid their tax obligations by hiding their assets in foreign bank accounts, and the financial institutions, bankers, and other professionals who facilitate these crimes."
Dana Boente, attorney of US, said: "The successful prosecution of Credit Suisse AG, and sentencing is representative of the tireless commitment and hard work of this office and our partners at the Internal Revenue Service."
"Today’s sentencing is yet another striking example of what happens to those who help offshore tax evaders," said IRS Commissioner Koskinen.
