GENEVA, Sept. 10, 2019 /PRNewswire/ -- Victims of a $1 billion fraud perpetrated by a Credit Suisse Relationship Manager who has since been convicted, have demanded the immediate return of a potential $150 million in commissions and fees paid to the Bank following fraudulent activities and mismanagement on their accounts over an eight-year period, CS Victims, a group of clients who are the victims of crimes, announced today.
The fees paid to Credit Suisse during the fraud include significant amounts generated from management of the affected client accounts and investment in the Bank's own products and funds.
Following the discovery of the fraud in 2015, Credit Suisse was ordered to provide a Swiss Prosecutor with information about the fees generated for the Bank by criminal activity and instructed PricewaterhouseCoopers to review the Bank's own assessment of those fees. It concluded that over $53 million was paid to Credit Suisse in commissions and fees from one client's accounts alone. During the recent appeal process, it was suggested that the total fees paid to Credit Suisse through its handling of affected clients' accounts was in excess of $150 million, an amount that has not been challenged by Credit Suisse.
The demand, sent to Credit Suisse's lawyers, also questions the completeness of the review, and the methodology used to support its findings. In particular, the clients believe PwC underestimated the length of the fraud, did not investigate transfers outside the Bank, did not identify which other Credit Suisse business units benefited from the fraud (independent of the desk run by the convicted Relationship Manager) and has been selective in which fees paid to the Bank it has included.
In addition, despite numerous requests, the full workings of the review have yet to be released by Credit Suisse to the affected clients, who continue to seek answers as to how relevant personnel were able to bypass the Bank's systems and controls (to the extent that there were any) to perpetrate the near $1 billion fraud. Despite assurances first given to a Geneva Court in January 2018, Credit Suisse continues to refuse to repay the full amount of the stolen funds to the affected clients.
A spokesperson for CS Victims, representing the defrauded clients, commented:
'It is unacceptable for Credit Suisse to profit from any illegal activity and it is a gross betrayal of the trust between a bank and its clients for the Bank to refuse to repay fees associated with it. At the very least, the Bank should immediately return such fees to the defrauded clients in full and with interest, including commissions paid to the Bank generated in the course of a fraud it failed to detect for many years. In addition, Credit Suisse should start being transparent about the profits generated from the trading of its own products and provide this information to us without delay.'
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CS Victims was established by the representatives of certain clients of Credit Suisse.
They are victims of an estimated $1billion fraud perpetrated by the Bank's personnel over seven years. At least one of Credit Suisse's employees has been convicted of fraud and FINMA has highlighted failures in Credit Suisse's systems and controls which led directly to crimes being committed.
SOURCE CS Victims