Credit Suisse to Pay $77 Million to Settle SEC, DOJ Bribery Charges

By:
Ruth Singleton
Published Date:
Jul 5, 2018

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Credit Suisse Group AG will pay roughly $30 million to resolve charges that it obtained investment-banking business in the Asia-Pacific region by awarding employment to friends and family of Chinese officials, in violation of the Foreign Corrupt Practices Act (FCPA), the Securities and Exchange Commission (SEC) announced today. The bank also agreed to pay a $47 million criminal penalty to the U.S. Department of Justice to resolve related charges.

According to the SEC order, “Between at least 2007 and 2013, Credit Suisse provided valuable employment to the relatives and friends of certain foreign government officials in the Asia-Pacific region as a personal benefit to the requesting officials in order to obtain or retain investment banking business or other benefits for the bank.”

Specifically, according to the SEC, Credit Suisse offered jobs to more than 100 individuals with some connection to foreign government officials, including more than 60 employees and interns referred by governmental officials at more than 20 different Chinese state-owned entities (SOEs). In return, Credit Suisse Hong Kong Ltd. and affiliates obtained deals from these SOEs that totaled tens of millions of dollars.

“Credit Suisse … engaged in a corrupt scheme to win business with Chinese state-owned entities by hiring friends and family of Chinese government officials, generating the bank at least $46 million in profits,” said Acting Assistant Attorney General John P. Cronan. “These ‘relationship hires’ often lacked necessary technical skills, and offered fewer qualifications and significantly less relevant banking experience than other candidates for the jobs.”

“Bribery can take many forms, including granting employment to friends and relatives of government officials,” said Charles Cain, chief of the SEC Enforcement Division’s FCPA Unit. “Credit Suisse’s practice of engaging in these hiring practices violated the law, and it is now being held to account for having done so.”

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