Financial Service Company Credit Suisse Pays the U.S. $47 Million to settle bribe allegations of Dept. of Justice and S.E.C.

An investigation under the Foreign Corrupt Practices Act (FCPA) leads Credit Suisse, a business based in Zurich which offers financial services and counsel, to pay $47 million to the Department of Justice (DOJ). The Swiss financial giant was being investigated due to the employment methods of their Hong Kong unit, Credit Suisse Hong Kong Ltd., and paid the $47 million as a penalty to end the FCPA investigation by the DOJ and the SEC.

First disclosed by Credit Suisse in February of 2018, the reason for the investigation was their recruitment practices in Asia between the years of 2007 to 2013. The Securities and Exchange Commission (SEC) along with the DOJ was also involved in this investigation. Credit Suisse stated that the focus was on whether those hired were referred by government agencies or state-owned entities for investment approval. The latter would go against the FCPA which strictly prohibits business assistance as a bribe to foreign officials.

Credit Suisse and the DOJ have now reached a non-prosecution agreement in regards to this investigation with no criminal charges according to a statement from Credit Suisse’s Hong Kong unit posted on the company’s website.

Credit Suisse was not the first company to have a potential violation of the FCPA by attempted bribing of those in power of foreign countries. BNY Mellon paid $14.8 million in 2015 due to charges involving them granting internships to the families of those connected to the Middle Eastern sovereign wealth fund. Also, Qualcomm Inc. paid $7.5 million in 2016 to settle the offence of hiring those in relation to the Chinese government officials. The SEC found that the Chinese officials were in the process of deciding if they wanted to use Qualcomm technology products. JPMorgan Chase paid $264 million also for hiring those close to the Chinese government in order to win banking deals.

The Foreign Corrupt Practices Act (FCPA) was enacted in 1977 and amended in 1998 to protect unfair bribery of foreign officials as a business practice. Along with these three banks, FCPA tracker has also cited Barclays PLC, Citigroup Inc., Deutsche Bank, HSBC Holdings plc, and Goldman Sachs Group Inc., as other banks that have been involved in FCPA-related investigations or incidents based on their hiring practices.

A statement released by Credit Suisse on June 6th, 2018 claims that this will have “no material impact on its 2Q 2018 results” and “since 2013 Credit Suisse has implemented numerous enhancements” and is “committed to upholding the highest standards of integrity and fair business practices.” The $47 million paid by Credit Suisse to the DOJ will officially resolve this matter and will allow the company to move forward with no criminal charges.

To learn more about this case or report suspected fraud, contact Newman & Shapiro today!