Business

US court fines Credit Suisse trader over bond prices

The logo of Swiss bank Credit Suisse is seen on an office building in Zurich May 20, 2014 Image copyright Reuters

A New York court has fined a former UK-based Credit Suisse trader for his role in artificially inflating bond prices.

David Higgs was spared prison, which was the fate of his boss.

Higgs pleaded guilty in 2012 to a conspiracy charge, was ordered to forfeit $900,000 (£530,000) to the government and pay a $50,000 fine by a judge in New York.

It is one of the few US criminal prosecutions stemming from the financial crisis.

Another trader with the bank, Salmaan Siddiqui, also pleaded guilty in 2012 and is due to be sentenced this month.

Higgs provided "extremely substantial assistance" after agreeing to co-operate with prosecutors.

'Extraordinary decision'

Higgs's former boss Kareem Serageldin entered his own guilty plea in April 2013 and was sentenced in November to two and a half years in prison.

Prosecutors said that Higgs's co-operation helped build a case against Serageldin and may have encouraged Siddiqui to plead guilty.

They also credited Higgs, a UK national, for his "extraordinary decision" to voluntarily travel to the US to plead guilty.

Prosecutors accused the three men of mispricing bonds secured against the value of mortgages between August 2007 and February 2008, as housing and credit markets were in decline.

Prosecutors said at Serageldin's sentencing that his book was overstated by $100m.

Credit Suisse was not charged and co-operated with investigators.

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