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Regulatory Sanctions

Credit Suisse Committed FCPA Violations - Criminal Fine & Disgorgement

July 5, 2018

by Howard Haykin


Credit Suisse agreed to pay nearly $30 million in disgorgement and prejudgment interest to settle SEC charges that it obtained investment banking business in the Asia-Pacific region by corruptly influencing foreign officials in violation of Foreign Corrupt Practices Act (FCPA).  Credit Suisse will also pay a $47 million criminal penalty to the U.S. Department of Justice.


In recent years, the SEC pinned similar charges on JPMorgan Chase and BNY Mellon, costing those banks $130 million and $15 million, respectively. JPMorgan Chase was penalized an additional $134 million by the DOJ and The Federal Reserve.

SEC FINDINGS.    Between at least 2007 and 2013, Credit Suisse provided valuable employment to the relatives and friends of certain foreign government officials in the Asia-Pacific region (“APAC”) as a personal benefit to the requesting officials in order to obtain or retain investment banking business or other benefits for the bank.


Because many of Credit Suisse’s clients were state-owned entities (“SOEs”), and because the individuals personally requesting employment or internships for their relatives and friends were either executives of these SOEs or were foreign government ministers with influence over the business decisions of SOEs, the requesting individuals qualified as foreign government officials under the FCPA.


Credit Suisse provided these jobs to certain of the referred candidates (“Referral Hires”) with the intent to corruptly influence the foreign government officials making the requests to secure banking business from the SOEs. Credit Suisse’s referral hiring practice resulted in multiple deals and substantial profits for Credit Suisse.


Credit Suisse had written policies that prohibited the hiring of candidates referred by or related to officials from SOEs or government ministries in order to obtain or retain business, but those policies were not meaningfully enforced.


  • At least one senior Credit Suisse manager in APAC believed that restrictions on referral hiring - including a proposed requirement that all Referral Hires be vetted through the established, merit-based campus recruiting program - would “kill” their business.
  • Steps were taken to make certain Referral Hires from SOEs appear to be normal, merit-based hires at Credit Suisse.
  • Since the company’s prohibition on improper SOE Referral Hires was not implemented in practice, many client referrals were hired by Credit Suisse without the requirement of any review by the bank’s Legal and Compliance Department to ensure compliance with the bank’s policies.
  • Senior Credit Suisse managers in APAC tracked the success of some of the bank’s Referral Hires in generating business through the use of spreadsheets that linked particular referral hires to specific business deals for the firm.
  • Certain senior personnel with Credit Suisse HK and in the U.S. were aware that referral hiring was taking place in the APAC region.


[For further details, click on ...  SEC Order.]