ZURICH (AP) — A Swiss court announced on Monday that it fined Credit Suisse more than $2 million for failing to prevent money laundering linked to a Bulgarian criminal organization fifteen years ago.
The court also ordered the forfeiture of the equivalent of more than $12 million in deposits linked to the criminal group and opened with Credit Suisse.
The bank is also on the hook for a compensatory claim of more than $19 million. This is the amount that the court found could not be confiscated due to the bank’s internal failings, which the court found encouraged the money laundering.
Zurich-based bank Credit Suisse, Switzerland’s second-largest bank after rival UBS, said it would appeal the ruling.
A former Credit Suisse employee who prosecutors say contributed to the organization’s ability to shield that $19 million from court scrutiny has also been found guilty, though the fine and 20-month sentence of former employee have been suspended.
Prosecutors said the anonymous former bank worker helped execute transactions for the organization between July 2007 and December 2008, “despite the presence of concrete clues as to the criminal origin of the funds”.
Two Bulgarian nationals were also convicted of participation in a criminal organization and aggravated money laundering for acts committed between May 2005 and January 2009.
The courts said they suspended sentences and fines for some of the people in part because of the time that has passed since the alleged crimes took place.
In the original indictment, the Swiss Attorney General’s Office noted how top athletes in Bulgaria after the fall of communism “turned to other sources of income, and many wrestlers were approached by mafia clans”. An unidentified wrestler aimed to make money by smuggling tons of cocaine via ‘mules’ from South America to Europe by air and sea and then laundering the profits.
Proceeds from drug sales, often in small denominations, entered Swiss bank accounts from 2004 until at least 2007 and were used to buy real estate in Bulgaria and Switzerland.
In February, Credit Suisse recorded a loss of 2 billion Swiss francs in the fourth quarter ($2.2 billion) as it capped a “challenging year” marked by bad bets on a hedge fund, set aside for legal fees and accounting changes due to its acquisition of a bank. American investment more than 20 years ago.
The bank launched a new strategy late last year after a series of setbacks tarnished its reputation.