The US government recently asked Swiss banks to provide information, even before UBS began negotiating the takeover of the ailing Credit Suisse bank. According to the sources, employees of some major US banks have been summoned. The DOJ investigation wants to know which bank employees dealt with sanctioned clients and how misled they were over the years.
Prior to the wave of sanctions in response to the Russian invasion of Ukraine, Credit Suisse was known to have a number of wealthy Russian clients. The peak value of Russian assets managed by the bank was $60 billion, which brought Credit Suisse annual revenues of $500-600 million.. When Credit Suisse spun off from Russian clients last May, it managed $33 billion in Russian assets, 50% more than UBS, although the latter’s wealth management business is larger.
Banks can expect severe penalties for violating US sanctions. BNP Paribas closed in 2014 He agreed to pay $9 billionAfter it was revealed that he conducted transactions for sanctioned Sudanese, Iranian and Cuban entities. In 2019, Standard Chartered agreed to pay more than $1 billion in fines for defrauding a former bank under US sanctions against Iran.
UBS has already expressed concern that the takeover would require it to take on the potential legal responsibilities of its competitor. The Swiss government said so It undertakes a guarantee of up to 9 billion francs for UBS losses resulting from the transaction.
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