Hundreds of Credit Suisse employees worked for years to deceive U.S. officials and help wealthy Americans avoid paying taxes through secret offshore accounts, Attorney General Eric Holder said Monday at a news conference announcing that the bank would pay about $2.6 billion.
Holder said it was the largest penalty imposed in any criminal tax case, and that Credit Suisse is the largest bank to plead guilty in a criminal case in 20 years. The bank has admitted wrongdoing and made various changes to allow it to move forward in compliance with the law, noted Holder, who dubbed the tax-evasion scheme "brazen."
"This case shows that no financial institution, no matter its size or global reach, is above the law," Holder said. "Credit Suisse conspired to help U.S. citizens hide assets in offshore accounts in order to evade paying taxes .... We will never hesitate to criminally sanction any company or individual that breaks the law."
In entering the plea agreement, Credit Suisse acknowledged that, for decades prior to and through 2009, its employees allowed and operated an illegal, international banking business that willfully helped thousands of Americans to open and maintain undeclared accounts, helping U.S. citizens cloak their foreign assets and their domestic income from the Internal Revenue Service.
The bank's sentencing date has been set for Aug. 12.
Credit Suisse Chief Executive Brady Dougan said in a statement, "We deeply regret the past misconduct that led to this settlement."
He added, "We have seen no material impact on our business resulting from the heightened public attention on this issue in the past several weeks."
The penalty resolves a yearslong criminal investigation into allegations that the bank recruited U.S. clients to open Swiss accounts and aided them in concealing the money.
"Our work in the offshore area is far from done," said Deputy Attorney General James M. Cole. "We will continue to hold to account the bankers, the brokers and other professionals in Switzerland and around the world as well as the institutions that trained and directed them to use bank secrecy laws to protect U.S. tax cheats."
The previous giant bank to plead guilty was investment bank Drexel Burnham Lambert, which pleaded guilty in 1989 to six felonies and agreed to pay a record total of $650 million plus interest and civil insider trading fines.
- Reuters, The Associated Press and NBC News staff
First published May 19 2014, 1:59 PM