US justice opens probe against Credit Suisse

Swiss banking giant Credit Suisse said Friday that it is being investigated by the US Department of Justice over private banking services provided to US taxpayers.

The Credit Suisse headquarters in Zurich.
Giorgia Xenakis

“On July 14, 2011, Credit Suisse received a letter notifying it that it is a target of the Department of Justice investigation,” said the bank in a statement.  

“It has been reported that the US authorities are conducting a broader industry inquiry,” it said, adding that the probe “concerns historical private banking services provided on a cross-border basis to US persons.”

“Subject to our Swiss legal obligations, we will continue to cooperate with the US authorities in an effort to resolve these matters,” said the bank.

The United States indicted four Credit Suisse bankers in February on charges of helping US taxpayers hide money in secret Swiss accounts to avoid US taxes.

At the time of that indictment, the bank said it was itself not part of the investigation.

The four bankers and unnamed co-conspirators were accused of offering US customers the chance to open accounts in Switzerland with the understanding that the money would be hidden from US tax authorities.

As of 2008, the bank hosted thousands of such accounts holding up to $3 billion in assets, the United States claimed.

The US probe against Credit Suisse comes after another damaging case against rival Swiss bank UBS.

Not only was UBS made to pay a $780 million fine, but the Swiss government was also forced to ease the country’s banking secrecy rules to allow the bank to hand over 4,000 case files on US clients suspected of tax evasion.

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Credit Suisse slashes jobs, branches to move ‘online’

Credit Suisse, Switzerland's second-biggest bank, said Tuesday it would reorientate its domestic services towards digital banking, with a quarter of its Swiss branches to close and hundreds of jobs at risk.

Credit Suisse slashes jobs, branches to move 'online'
A Credit Suisse branch. Photo: FABRICE COFFRINI / AFP

“In the last two years alone, use of online banking at Credit Suisse has grown by approximately 40 percent, while the use of mobile banking has more than doubled,” the bank said in a statement.

“The COVID-19 crisis has further accelerated these trends. In contrast, the number of visits to branches has been declining for years.

“Credit Suisse will introduce a new digital offering and a future-oriented branch concept at the end of October.”

The bank also plans to merge the activities of regional subsidiary Neue Aargauer Bank with those under the Credit Suisse brand to avoid duplication.

READ: How to open a bank account in Switzerland 

With its realignment, the bank intends to reduce annual costs by around 100 million Swiss francs ($110 million, 93 million euros) from 2022 onwards. It plans to cut the number of bank branches from 146 to 109.

Meanwhile up to 500 jobs could be axed, Andre Helfenstein, head of the bank's operations within Switzerland, told reporters during a conference call.

The restructuring costs are expected to be 75 million Swiss francs. “Digitalisation is happening all around us,” Helfenstein said in a statement.

“The changes we are making to our branch network — while simultaneously investing in digital solutions and in advisory services for clients with more complex needs — represent a logical step forward.”

In late July, the bank's new chief executive Thomas Gottstein unveiled his plans for Credit Suisse, which involved regrouping its different investment bank activities.

Gottstein took charge in February after Tidjane Thiam was ousted over a massive spying scandal.