Suspected corruption and deficiencies in Credit Suisse’s anti-money laundering processes have been uncovered and publicised by the Swiss Financial Market Supervisory Authority (Finma).
In a statement on the Finma website on Monday, the Swiss watchdog said it identified shortcomings that occurred repeatedly over a number of years, mainly before 2014.
The failings were, in part, linked to three investigations Finma has conducted at several banks since 2015 in relation to suspected corruption involving world football association Fifa, Brazil’s Petrobras and Venezuela’s Petroleos de Venezuela (PDVSA).
A separate ‘enforcement procedure’ into relationships between banks and politically exposed persons (Peps) identified anti-money laundering issues, as well as shortcomings in Credit Suisse’s control mechanisms and risk management.
Finma outlined steps to further improve the bank’s processes and accelerate the implementation of remediations already initiated by Credit Suisse.
A third party will be commissioned to monitor the effectiveness of the measures.
Legacy issues
In response, Credit Suisse stated it has “taken note” of Finma’s announcement and “acknowledges the conclusions it has reached regarding our bank as part of an ongoing review of legacy cases across the Swiss banking sector”.
“The bank commissioned independent reviews of the conduct in question, self-reported the shortcomings and has cooperated with Finma throughout the process, taking proactive remediation measures,” a spokesperson said.
“We are grateful to Finma for its acknowledgement of the improvements that have been made to our compliance and control framework over the last few years and of the additional measures already planned by the bank.”
Due diligence deficiencies
In relation to the Fifa, Petrobras and PDVSA investigations, Finma determined that Credit Suisse had “infringed its anti-money laundering supervisory obligations in all three instances”.
In addition, the following shortcomings were identified:
- Identifying the clients;
- Determining the beneficial owner;
- Categorising a business relationship as posing an increased risk;
- Performing the necessary clarifications upon increased risk, plus associated plausibility checks; and,
- Documentation
With regard to Peps, Finma found that the bank was too slow to identify and treat such clients as posing increased risks.
The bank also failed to meet its heightened due diligence obligations regarding investigation, plausibility checks and documentation regarding the client and certain related high-risk transactions.
