Credit Suisse expects to pay $536m to settle US sanctions probe

Credit Suisse expects to pay $536m to settle US sanctions probe

Credit Suisse says it expects to pay around $536 million to settle a probe by US authorities into claims it helped process payments in violation of sanctions covering Iran.

The bank says it is in "advanced settlement discussions" with authorities over a previously disclosed investigation into US dollar payments between 2002 and April 2007 "involving parties that are subject to US economic sanctions".

The expected fine comes nearly a year after Lloyds TSB was slapped with a $350 million penalty over its "criminal conduct" in deliberately falsifying wire transfers destined for countries or individuals on US sanctions lists.

According to court documents, Lloyds deliberately removed material information - such as customer names, bank names and addresses - from payment messages so that the wire transfers would pass undetected through filters at US financial institutions.

Credit Suisse is just one of eight other major banks that have also been investigated for "stripping" wire transfer information, according to a Bloomberg report.

The Swiss bank says that, while it had recorded provisions related to the case through the end of the third quarter of 2009, it expects to record an additional pre-tax charge of SFr445 million in the current quarter, which is estimated to be around SFr360 million after tax.

It says it decided to exit the business in Iran in December 2005, closing the Tehran office the following year, and undertook an independent investigation into the Zurich-based payment activity. It has subsequently beefed up its global compliance programme and improved sanctions filters screening.

The authorities involved in settlement discussions are the New York County District Attorney's Office, the US Department of Justice, the Board of Governors of the Federal Reserve System and the Federal Reserve Bank of New York, and the Office of Foreign Assets Control.

Comments: (0)