The Department of Justice has announced that Credit Suisse Services AG will pay over $510 million in penalties for aiding U.S. taxpayers in evading the IRS through offshore accounts.
This hefty fine is part of a non-prosecution agreement reached on Monday, following the UBS acquisition of Credit Suisse. The issue primarily revolves around the bank’s collusion with clients to maintain numerous offshore accounts, essentially helping them to hide wealth and avoid taxes.
Credit Suisse Services AG worked alongside its employees, U.S. clients, and others from January 2010 through July 2021, knowingly assisting them in managing assets at the bank.
According to the DOJ, the bank facilitated wealthy U.S. clients in having “undeclared” offshore accounts, thereby promoting non-compliance with filing requirements that violated a plea agreement from 2014.
The DOJ reported that there are unfiled accounts exceeding $2 billion for U.S. taxpayers at Credit Suisse AG Singapore between 2014 and June 2023. This was highlighted by an undeclared account that UBS flagged to the DOJ after it acquired rival banks.
Credit Suisse Services AG and UBS have agreed to cooperate with the ongoing investigation and provide additional details related to their guilty plea and U.S. accounts possibly identified as part of the agreement.
Back in 2014, Credit Suisse had already pleaded guilty to criminal charges and agreed to a $2.5 billion fine for helping Americans avoid taxes over many years.
Before the recent settlement, the U.S. Senate Treasury Committee discovered that Credit Suisse had breached its 2014 agreement by continuing to facilitate tax evasion, covering up over $700 million from the government.
On Monday, UBS confirmed that Credit Suisse Services AG admitted guilt related to a conspiracy to assist in filing false income tax returns.
UBS stated it maintains a strict policy against tax evasion and emphasized that this resolution helps to clear up legacy issues from Credit Suisse for the benefit of all stakeholders.
In March 2023, UBS announced it would acquire Credit Suisse amid fears of the latter’s imminent collapse, completing the acquisition later that year.
