• Global Anti-Corruption Practice

Case Detail

In the Matter of Credit Suisse Group AG (2018)


Case Details
  • Case Name
  • In the Matter of Credit Suisse Group AG (2018)
  • Date Filed
  • 07/05/2018
  • Enforcement Agency
  • SEC
  • Countries
  • China
  • Foreign Official
  • Unnamed executives of state-owned enterprises and government officials in China.
  • Date of Conduct
  • 2007 to 2013
  • Nature of Business
  • Credit Suisse Group AG is a Swiss holding company and multinational financial services company.  Credit Suisse issues a class of stock registered with the SEC under Section 12(b) of the Exchange Act and traded on the New York Stock Exchange.  Credit Suisse (Hong Kong) Limited (“CSHK”) is Credit Suisse’s wholly owned subsidiary incorporated in Hong Kong that provides securities products and financial advisory services in the Asian-Pacific region.   
  • Influence to be Obtained
  • According to the SEC, from 2007 to at least 2013, CSHK engaged in corrupt hiring practices to obtain and retain business in China.  The SEC alleged that CSHK hired and promoted more than 60 individuals related to Chinese government officials and executives at state-owned enterprises, even though these individuals were less qualified for the positions.  In exchange for the employment of their relatives, government officials would direct or maintain business with CSHK, bringing in tens of millions of dollars in revenue, and the officials also provided advice and assistance to CSHK in obtaining regulatory approvals for its business.  CSHK engaged in these corrupt hiring practices even though it was aware of the FCPA compliance risks and the practices violated Credit Suisse’s Global Anti-Bribery Policy.  To avoid detection, CSHK attempted to portray the hires as merit-based and it did not adhere to Credit Suisse’s policy requirement that government-related hires must be reviewed by the bank’s Legal and Compliance department.

    The SEC alleged that senior CSHK managers were aware of the hiring practices, as well as the compliance risks associated with them, but failed to take adequate steps to prevent or mitigate the risks, resulting in violations of the FCPA’s anti-bribery and internal controls provisions.  
  • Enforcement
  • On July 5, 2018, the SEC settled its enforcement action against Credit Suisse Group for violations of the FCPA’s anti-bribery and internal controls provisions.  According to the cease-and-desist order, Credit Suisse Group AG agreed to pay $29,823,804 in disgorgement and prejudgment interest.  The SEC did not impose a monetary penalty in light of the criminal penalty imposed by the DOJ.

    In a related action, CSHK entered into a non-prosecution agreement with the DOJ on May 24, 2018 in which it agreed to pay a monetary penalty of $47,029,916 to settle the charges against it.
  • Amount of the Value
  • Not stated.
  • Amount of Business Related to Payment
  • Not stated.
  • Intermediary
  • None.
  • Citizenship of Parent Entity
  • Switzerland
  • Total Sanction
  • $ 29,823,804
  • Compliance Monitor
  • No
  • Reporting Requirements
  • No
  • Case is Pending?
  • No
  • Total Combined Monetary Sanction
  • $ 76,853,720
  • Industries
  • Finance & Banking
  • Regions
  • Asia
Defendants

Credit Suisse Group AG

  • Citation
  • In the Matter of Credit Suisse Group AG, Admin. Proc. File No. 3-18571 (July 5, 2018).
  • Date Filed
  • 07/05/2018
  • Filed Under Seal
  • No
  • Date Case Was Unsealed
  • 10/10/2018
  • FCPA Statutory Provision
    • Anti-Bribery
    • Internal Controls
  • Other Statutory Provision
  • None.
  • Disposition
  • Cease-and-Desist Order, Cease-and-Desist Order
  • Defendant Jurisdictional Basis
  • Issuer
  • Defendant's Citizenship
  • Switzerland
  • Individual Sanction
  • $29,823,804.
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