Image Source: Private Banker International
Credit Suisse has been found guilty and punished due to its role in money laundering connected to a narcotics network in Bulgaria.
According to Switzerland’s criminal court, the bank did not take sufficient steps to stop members of the crime syndicate from making money off the trafficking of cocaine into Europe. It was hit with a £1.7 million punishment and forced to reimburse the Swiss government £15 million.
The bank asserted its innocence and announced it would challenge the judgment in court.
The highest criminal court in Switzerland found former Bulgarian tennis star Elena Pampoulova-Bergomi guilty of money laundering and sentenced her to 20 months in prison with a suspended sentence. Her £1.7 million fine was suspended as well.
The bank’s participation in receiving millions of Euros in bank deposits between 2004 and 2008 was the subject of testimony before the court, which it claimed was replete with warning signs.
According to the prosecution, Pampoulova-Bergomi developed an unofficial financial connection with former Bulgarian wrestler Evelin Banev, who was a key player in a European cocaine smuggling ring.
According to testimony given in court, the former tennis player frequently obtained bags “full of cash” from acquaintances of the wrestler, some of which totaled the equivalent of £400,000.
Additionally, testimony on the drug trafficking gang’s criminal acts, including murder, was presented before the Swiss court.
Credit Suisse, the second-largest bank in Switzerland has denies any wrongdoing. It is the first time that a Swiss bank has been the target of such legal action. The bank stated that it “continuously tests its anti-money-laundering architecture and has been enhancing it over time, in conformity with growing regulatory standards.”
The decision causes more trouble for Switzerland’s second-largest bank, which is already dealing with billions of damages from risk-management and compliance mistakes.
Credit Suisse was slapped with a $2 million (CHF) penalty. The court also ordered the bank to forfeit more than 19 million francs, which is the amount that could not be confiscated because of internal problems at Credit Suisse, in addition to ordering the confiscation of assets worth more than 12 million francs that the drug gang held in accounts at Credit Suisse.
The former employee was given a suspended 20-month prison sentence for money laundering as well as a fine by the court. Alice de Chambrier, a federal prosecutor, praised the verdict as “excellent for transparency.”
The former employee and Credit Suisse both denied misconduct. However, Credit Suisse declared that it would contest the judgment.
Monday’s afternoon trade saw a 0.7 percent decline in Credit Suisse stock, although the day ended up 0.4 percent higher.
