Report: Credit Suisse helped its customers hide billions

Published 12:00 am Wednesday, February 26, 2014

WASHINGTON — An elevator controlled remotely. A bank office referred to by its code name. A sheaf of bank statements hidden in the pages of Sports Illustrated.

At times, a Senate report into how Credit Suisse, a bank based in Zurich, helped its American customers hide billions of dollars of assets from the U.S. Treasury reads more like a John Grisham novel than a white paper.

The report, the product of a two-year investigation, was released on Tuesday by the Senate Permanent Subcommittee on Investigations. The report contends that the bank actively helped thousands of Americans conceal their wealth offshore.

Brady Dougan, the chief executive of Credit Suisse, and other top bank officials are scheduled to appear along with two Justice Department officials at a hearing on the report today.

“It’s time to ramp up the collection of taxes due from tax evaders on the billions of dollars hidden offshore,” Sen. Carl Levin, D-Mich., the subcommittee’s chairman, said in a statement.

The report is scathing both to the financial institution and to U.S. law enforcement, which the subcommittee accuses of dragging its feet in holding the bank and the relevant taxpayers accountable.

The 176-page report charges that from at least 2001 through 2008, the Swiss bank helped its U.S. customers evade taxes through a variety of means, including opening accounts in the name of “shell” companies and sending Swiss bankers to the United States to “secretly” recruit new clients and avoid creating a paper trail.

The report describes one instance in which a Credit Suisse banker “traveled to the U.S. to meet with the customer at the Mandarin Oriental Hotel and, over breakfast, handed the customer bank statements hidden in a Sports Illustrated magazine.”

The bank’s New York office also “kept a document listing ‘important phone numbers’ of intermediaries that formed offshore shell entities for some of the bank’s U.S. customers” and urged U.S. customers to come to Switzerland to do their banking, opening a full-service office in the Zurich airport, the report said. That office even had a code name, “SIOA5.”

Dougan told the Senate investigators that the airport office was for the convenience of clients heading to and from Swiss ski resorts, so that they would not have to go out of their way to Zurich.

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