Landmark money laundering lawsuit opened at Credit Suisse
Credit Suisse on Monday became the first Swiss bank in the country’s history to face criminal charges, with the opening of a case involving millions of euros in allegedly laundered drug money.
At the center of the trial are allegations, set out in a 500-page indictment, about the bank’s treatment of funds for a Bulgarian mafia between 2004 and 2008.
The indictment accuses the bank of failing to properly inquire into the source of the funds or carry out proper checks on its clients – chief among them a former professional wrestler, Evelin Banev, who was at the head of a major operation European cocaine smuggler.
Prosecutors told judges they were seeking 42 million Swiss francs (40 million euros) in fines from the bank.
A former Credit Suisse relationship manager, now gone, is named as co-accused.
Prosecutors allege she routinely collected suitcases worth more than €500,000 from people in Banev’s entourage, including from a customer who was shot dead outside a restaurant in Sofia in 2005.
Banev and other Bulgarian clients’ dealings with the bank appeared deliberately organized to avoid triggering internal money laundering warnings, prosecutors said. “[There were] strong indications as to the criminal origin of the funds,” the indictment states.
“Credit Suisse unreservedly rejects as baseless all allegations in this inheritance case against it and is satisfied that its former employee is innocent,” the bank said in a statement. “The bank will vigorously defend itself in court.”
The identity of the relationship manager cannot be revealed under Swiss law.
His lawyer, Grégoire Mangeat, told the Financial Times that his client was “outraged” by the charges and was unfairly targeted to facilitate the case against Credit Suisse and the prosecutor’s eagerness to win a case against one of the most major financial institutions in the country. “We will plead for his full and complete acquittal,” he said.
Banev was convicted of drug trafficking in Italy in 2017 and money laundering in Bulgaria in 2018. He is not charged in the Swiss case. After disappearing, he was arrested last year in Ukraine and faces extradition to Romania and Bulgaria to face new criminal charges.
Credit Suisse, at 166, is considered by many in Switzerland to be a national institution. But it has struggled with crises of late, ranging from its involvement with Greensill Capital and family office Archegos to the resignation of its chairman António Horta-Osório after less than a year for breaching Covid-19 quarantine rules.
No Swiss bank has ever been found guilty of criminal offenses in Switzerland – a prosecution that would fall under Article 102 of the Swiss criminal code, which stipulates the specific circumstances in which a company can be held criminally liable.
In December, the defunct Abu Dhabi-owned Falcon Bank, which had operations in Switzerland, became the first bank to be convicted under Section 102 for money laundering offences.
The trial, in the southern city of Bellinzona, is due to continue until March.