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Whistleblowers aid in Credit Suisse investigation

On Behalf of | Apr 18, 2023 | Government Regulation, Whistleblower Protection

We recently discussed a Swiss banker’s so-called Singapore solution money laundering scheme. Now we turn to Credit Suisse, which has a track record of shady deals and nearly followed in the footsteps of Silicon Valley Bank’s collapse. Instead, the Swiss government authorized larger Swiss bank rival UBS Group AG to buy it for $3.3 billion to avoid the bank’s collapse, which was seen as a threat to the global banking system. Nevertheless, the beleaguered bank is not yet out of the woods.

Still hiding money

A Whistleblower aided the U.S. Senate Finance Committee in spotlighting the bank’s ongoing attempts to hide U.S. citizens’ money. The committee accuses Credit Suisse of violating the 2014 criminal plea agreement it struck after helping U.S. citizens hide assets from the IRS. At that time, the bank paid $2.6 billion in fines. At the heart of the current investigation is a $100 million fortune held by a family with dual U.S. and Latin American citizenship who have assets in undeclared Credit Suisse accounts.

The Senate committee report also says there are gaps in the U.S. banking system for identifying tax evasion and asks the IRS and Department of Justice to conduct further investigations.

Whistleblowers once again help

The 2014 case used whistleblowers and other means to identify tax cheats. Using the information provided during that investigation, Congress preemptively passed a law in 2010 that required foreign banks to report any accounts held by American citizens. The Senate committee once again got help in 2021 from a whistleblower, who provided information on hidden accounts that the bank was supposed to produce.

U.S. regulators could collect up to $1.3 billion if Credit Suisse violated its plea agreement. Depending upon their information, the whistleblower could get between 10% to 30% of the total collected by the U.S. government.