A Senate Finance Committee investigation has found major violations by Swiss bank Credit Suisse of a 2014 plea agreement it made with the U.S. Department of Justice (DOJ).
The two-year investigation, led by Senate Finance Committee Chair Ron Wyden (D-OR), found that Credit Suisse has enabled tax evasion by thousands of wealthy U.S. individuals, violating the plea agreement.
Among the violations was a previously unknown, ongoing, and potentially criminal conspiracy involving the failure to disclose nearly $100 million in secret offshore accounts belonging to a single family of American taxpayers. The investigation also shed light on how Credit Suisse bankers aided and abetted offshore tax evasion by U.S. businessman Dan Horsky. Horsky pleaded guilty in 2016 to one of the largest criminal tax evasion cases in American history.
“At the center of this investigation are greedy Swiss bankers and catnapping government regulators, and the result appears to be a massive, ongoing conspiracy to help ultra-wealthy U.S. citizens to evade taxes and rip off their fellow Americans,” Wyden said. “Credit Suisse got a discount on the penalty it faced in 2014 for enabling tax evasion because bank executives swore up and down they’d get out of the business of defrauding the United States. This investigation shows Credit Suisse did not make good on that promise, and the bank’s pending acquisition does not wipe the slate clean.”
The committee also requested information from Credit Suisse on any other large, undeclared accounts belonging to ultra-wealthy U.S. citizens with more than $20 million held at the bank. Credit Suisse disclosed to the committee that it had identified 23 such accounts, with more reviews underway. Thus, the total amount concealed in violation of Credit Suisse’s 2014 plea agreement is more than $700 million.
“Finally, the cases detailed in this investigation are textbook examples of why Democrats gave the IRS new funding for enforcement. Republican budget cuts have decimated the IRS’s ability to root out this kind of offshore tax evasion scheme, but Democrats are committed to stepping up enforcement against wealthy tax cheats,” Wyden said.
Wyden and the committee said the DOJ must conduct rigorous scrutiny into why Credit Suisse continues to discover large, secret accounts held by U.S. persons. The committee is concerned that nine years after signing its plea agreement with DOJ, Credit Suisse is still disclosing information about large potentially undeclared accounts that may have been held at the bank.