Credit Suisse to pay $536M for blockade violations

News from Cuba | Sunday, 20 December 2009

Credit Suisse agreed to pay $536 million to settle claims the bank helped process payments that let Iran and other nations -- including Cuba -- avoid government sanctions and gain access to U.S. financial markets.

The Zurich-based bank entered into a deferred prosecution agreement in settling with the U.S. Justice Department, which said Credit Suisse made more than $1.6 billion in illegal transactions involving Iran, Sudan, Burma, Cuba and Libya from the mid-1990s through 2006, according to a court document filed in Washington Wednesday.

``Credit Suisse will not flout the law again for its own financial gain," Attorney General Eric Holder said at a news conference. ``We will be vigilant in enforcing this settlement and in pursuing other institutions and individuals who engage in similar illegal conduct."

Without U.S. approval, the bank sent at least 40 outbound payment messages involving Sudan, 32 related to Cuba and 30 for Burma, the document said.

Credit Suisse, Lloyds TSB Bank and eight other banks have been investigated for ``stripping" wire transfer information to conceal illegal money transfers. Credit Suisse altered its dollar payments by removing Iranian names and references from messages and using code words for sanctioned entities when trading in U.S. securities, according to court documents. The bank also instructed Iranian customers on how to format dollar-denominated transactions to evade detection.

``Credit Suisse knew that without such alterations, amendments and code words, automated (U.S. Department of the Treasury's Office of Foreign Assets Control) filters at U.S. clearing banks would likely halt the payment messages and securities transactions," prosecutors said in charging documents.

The bank told its Iranian clients ``under no circumstances any link to your good bank or Iran should be mentioned," according to a court document. Instead, Credit Suisse used abbreviations for Iranian customer names or the phrase ``one of our customers" to describe the client.

Credit Suisse also made transactions on behalf of Arab Bank for Economic Development in Africa and Libyan Arab Foreign Investment Co. in violation of U.S. sanctions.

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