After months of delegation, Credit Suisse, the second largest bank based in Switzerland has admitted to helping wealthy Americans evade U.S. taxes by holding their money in offshore accounts. The Swiss bank will pay $2.6 billion in settlement charges, which makes this criminal tax penalty the biggest to date.
The Credit Suisse bank scandal involved the Swiss bank helping rich Americans hide over $10 billion in over 22,000 accounts. For decades, Credit Suisse created fake accounts and destroyed documents to protect thousands of its wealthy American clients in their efforts to evade taxes. Additional techniques used to avoid detection included the use of stashing bank statements in Sports Illustrated magazines, remote-controlled elevators to hide clients as they visited Swiss bankers, and secret banking services offered at Swiss airports to allow clients quick and easy access to cash.
Attorney General Eric Holder said, “I can announce that Credit Suisse has agreed to plead guilty to criminal charges related to this pervasive illegal activity. This is the largest bank to please guilty in 20 years. The bank will pay a total of $1.8 billion in the form of a fine of over $1.13 billion and nearly $670 million in restitution to the IRS. They have admitted criminal wrongdoing.”
In response, Credit Suisse’s American CEO, Brady Dougan, stated, “Having this matter fully resolved is an important step forward for us.”
The Department of Justice has been under much scrutiny ever since it failed to prosecute big banks who were involved with sketchy practices after the financial crisis of 2008. While banks are widely known to have their fair share of domestic scandals, the Department of Justice has made an effort to pursue international banks who have helped Americans perform tax evasion.
What about the people who got away with tax evasion?
There is only problem with the ordeal is the fact that approximately 22,000 Americans were able to evade taxes through Credit Suisse. These people’s names were not released, which means they were successful in getting away with tax evasion.
“It is a mystery to me why the U.S. government didn’t require as part of the agreement that the bank cough up some of the names of the U.S. clients with secret Swiss bank accounts,” Democratic Senator Carl Levin of Michigan stated. He added, “More than 20,000 Americans were Credit Suisse account holders in Switzerland, the vast majority of whom never disclosed their accounts as required by U.S. law. This leaves their identities undisclosed, with no accountability for taxes owed.”
In order for the Credit Suisse bank scandal to be resolved properly, the bank needs to hand over all of the names of everyone who was involved with tax evasion all these years. Finally getting to the bottom of things to make Credit Suisse plead guilty in aiding wealthy Americans evade taxes is a start, and those involved with tax evasion should pay up and face criminal charges as well.