Swiss bank Credit Suisse was found guilty by the country’s Federal Criminal Court on June 27 for failing to prevent money laundering by a Bulgarian cocaine trafficking gang in the first such criminal trial Switzerland has seen against one of its major banks.
The case involved millions of euros in bank deposits made by the trafficking ring to Credit Suisse between 2004 and 2008. The deposits came as a result of drug sales activities and were eventually used to buy real estate in Switzerland and Bulgaria.
According to prosecutors, a former bank employee built an informal financial relationship with Bulgarian wrestler Evelin Banev, a key figure in the cocaine smuggling ring.
"The court found deficiencies within the bank ... with regard to the management of client relations with the criminal organization,” the court said in a statement, the BBC reported. “These deficiencies enabled the withdrawal of the criminal organization’s assets.”
If Credit Suisse had fulfilled its organizational obligations, they could have prevented the infringement, said the presiding judge while handing down the verdict, according to Reuters. The judge also blamed Pampoulova-Bergomi’s superiors at Credit Suisse for being “passive.”
The court has fined Credit Suisse 2 million Swiss francs ($2.1 million) and ordered confiscation of assets worth over 12 million francs ($12.5 million) that the trafficking ring held at Credit Suisse.
An Impactful DecisionThis is the first time that a Swiss bank has been subject to such criminal proceedings, thus potentially making the court judgment a critical one. Credit Suisse is Switzerland’s second-largest bank after UBS.
According to Swiss laws, a company can be held accountable for failing to take necessary measures to prevent a crime from taking place. Following an international regulatory crackdown aimed at preventing money laundering, private banks in Switzerland have adopted stricter anti-money laundering checks.
"Credit Suisse Group has taken note of the Swiss Federal Criminal Court's decision to impose a fine of CHF 2 million against Credit Suisse AG for certain historical organizational inadequacies (article 102 of the Swiss Criminal Code) for the period between July 2007 and December 2008," said the bank in an emailed statement to The Epoch Times. "The investigation dates back more than 14 years. The bank will appeal the decision."
"Credit Suisse is continuously testing its anti-money laundering framework and has been strengthening it over time, in accordance with evolving regulatory standards. Generating compliant business growth in line with legal and regulatory requirements is key for Credit Suisse."