Credit Suisse to pay for offshore tax evasion
20 May 2014 New York
Image: Shutterstock
Credit Suisse has admitted that it helped American citizens to evade paying US tax by placing money in Swiss accounts.
The bank has agreed to pay $2.815 million in settlements, a $1.8 billion fine and $670 million in restitution to the US Internal Revenue Service (IRS).
The bank’s settlement comprises of $2 million for the Department of Justice, one third of which is allocated to the Internal Revenue Service.
The New York State Department of Financial Services will receive $715 million and $100 million will go to the Federal Reserve.
Kathryn Keneally, the assistant general attorney for the tax division of the Department of Justice, said: “We are committed to using all enforcement tools against those who seek to avoid their legal obligations, by hiding their assets in foreign bank accounts.”
“We appreciate that Credit Suisse has taken this significant step to accept the consequences of these acts and that Credit Suisse has ceased this conduct, and has changed its business operations to ensure that US taxpayers will no longer be able to hide their assets at Credit Suisse”, added Keneally.
Following a recent probe by the Department of Justice, Credit Suisse pleaded guilty to one count of conspiracy to aid US customers with submitting false tax returns to the IRS to protect offshore Swiss accounts.
It also failed to preserve documents for the Department of Justice’s investigation.
Credit Suisse has agreed to work with the Department of Justice and will supply it with any required information.
Brady Dougan, CEO of Credit Suisse, said: ““We deeply regret the past misconduct that led to this settlement. Having this matter fully resolved is an important step forward for us.”
The Foreign Account Tax Compliance Act (FATCA) is due to come into effect from 1 July. Once it is in force, every US citizen with $50,000 of assets or more must declare their activity in both offshore and onshore accounts to US tax authorities.
The bank has agreed to pay $2.815 million in settlements, a $1.8 billion fine and $670 million in restitution to the US Internal Revenue Service (IRS).
The bank’s settlement comprises of $2 million for the Department of Justice, one third of which is allocated to the Internal Revenue Service.
The New York State Department of Financial Services will receive $715 million and $100 million will go to the Federal Reserve.
Kathryn Keneally, the assistant general attorney for the tax division of the Department of Justice, said: “We are committed to using all enforcement tools against those who seek to avoid their legal obligations, by hiding their assets in foreign bank accounts.”
“We appreciate that Credit Suisse has taken this significant step to accept the consequences of these acts and that Credit Suisse has ceased this conduct, and has changed its business operations to ensure that US taxpayers will no longer be able to hide their assets at Credit Suisse”, added Keneally.
Following a recent probe by the Department of Justice, Credit Suisse pleaded guilty to one count of conspiracy to aid US customers with submitting false tax returns to the IRS to protect offshore Swiss accounts.
It also failed to preserve documents for the Department of Justice’s investigation.
Credit Suisse has agreed to work with the Department of Justice and will supply it with any required information.
Brady Dougan, CEO of Credit Suisse, said: ““We deeply regret the past misconduct that led to this settlement. Having this matter fully resolved is an important step forward for us.”
The Foreign Account Tax Compliance Act (FATCA) is due to come into effect from 1 July. Once it is in force, every US citizen with $50,000 of assets or more must declare their activity in both offshore and onshore accounts to US tax authorities.
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