SEC Issues FCPA Charges Against Credit Suisse

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The U.S. Securities and Exchange Commission (SEC) recently announced that Credit Suisse Group will pay roughly $30 million to resolve charges. Essentially, these charges are in regards to it obtaining investment banking business in the Asia-Pacific region by corruptly influencing foreign officials in violation of Foreign Corrupt Practices Act (FCPA).

According to the SEC’s order, several senior Credit Suisse managers in the Asia-Pacific region sought to win business by hiring and promoting individuals connected to government officials as part of a quid pro quo arrangement.

While this practice bypassed the firm’s normal hiring process, employees in other Credit Suisse subsidiaries and affiliates were aware of it and in some instances approved these “relationship hires” or “referral hires.”

Over the course of a seven-year period, the SEC found that Credit Suisse hired more than 100 employees at the request of foreign government officials, resulting in millions of dollars of business revenue.

Credit Suisse agreed to pay disgorgement of $24.9 million, plus $4.8 million in interest, to settle the SEC’s case. Separately, Credit Suisse also agreed to pay a $47 million criminal penalty to the U.S. Department of Justice.

Charles Cain, chief of the SEC Enforcement Division’s FCPA Unit, commented:

Bribery can take many forms, including granting employment to friends and relatives of government officials.  Credit Suisse’s practice of engaging in these hiring practices violated the law, and it is now being held to account for having done so.