Credit Suisse boss tells Senate that he 'regrets' tax ploy
- 26 February 2014
- From the section Business
The boss of Swiss bank Credit Suisse has said he "deeply regrets" that some of its bankers violated US tax laws.
But Chief Executive Brady Dougan said in a statement to a US Senate committee that there was only "scattered evidence" of improper conduct.
A US Senate report alleged the bank had helped US clients hide billions of dollars from the US taxman.
Mr Dougan admitted some private bankers had helped Americans hide income and assets to illegally avoid US tax.
He said: "We deeply regret that - despite the industry-leading compliance measures we have put in place - before 2009, some Credit Suisse private bankers appear to have violated US law."
"The evidence showed that some Swiss-based private bankers went to great lengths to disguise their bad conduct from Credit Suisse executive management."
The report said that in 2006, Credit Suisse held 22,000 accounts from US customers worth 12bn Swiss francs ($13.5bn; £8.1bn).
Mr Dougan disputed some of the findings of the report, saying the subcommittee wrongly assumed every US client account held in Switzerland was hidden from the US government.
He said the bank was fighting lawsuits in Switzerland from clients trying to prevent it from giving information to the US authorities.
"These are not the actions of an institution flouting US law enforcement or hiding behind Swiss law," he said.
Currently, the US Justice Department (DOJ) is investigating 14 Swiss banks over tax evasion - five years after UBS admitted to helping US clients hide money.
"It's five years later, and the sad truth is that the era of bank secrecy is not over," said Senator Carl Levin, a democrat from Michigan and chairman of the Senate committee that published the report.
"We have great concern that the battle to collect those unpaid taxes on hidden offshore assets seems stalled."
During the Senate hearing, US politicians lashed out at Credit Suisse executives both over the bank's behaviour and over the Swiss government's perceived obstructions into helping US authorities identify Americans who are evading tax.
"The whole idea that the Swiss government is cooperating with us is a joke," said Mr Levin.
He also scolded the DOJ for having only identified 238 client names from Credit Suisse out of 20,000 accounts.
"To collect those unpaid taxes and hold U.S. tax evaders accountable, the critical first step is to get their names," he said.
According to the report, after Credit Suisse started phasing out its tax evasion practices, the number of Swiss accounts held by US clients at Credit Suisse fell by 85%.