Credit Suisse Group AG will pay $196 million to settle charges that it violated federal securities law by providing cross-border financial services for U.S. clients without registering with regulators.
The U.S. Securities and Exchange Commission say the Swiss bank provided these services to thousands of U.S. clients over a seven-year period. Regulators say the bank began to curb this practice in 2008 after a civil and criminal investigation into similar conduct by Swiss-based UBS.
Following a U.S. Department of Justice criminal tax investigation, UBS had formally announced in 2008 that it would cease providing banking services to U.S. clients through its non-U.S. regulated entities. In 2009, U.S. authorities fined UBS $780 million for helping U.S. citizens avoid paying taxes.
The SEC said that Credit Suisse began to take steps in October 2008 to exit the business of providing cross-border advisory and brokerage services to U.S. clients but it took until 2013 to completely exit the business.
Credit Suisse agreed to the payment and acknowledged that its conduct violated securities law, the agency said.
The bank said Friday that it is pleased to settle the matter with the SEC. It is still facing a Department of Justice investigation into tax-related issues associated with the business.
The U.S. government has been pushing Switzerland to loosen its rules on banking secrecy since the UBS incident. Switzerland has been trying to shed its image as a tax haven, signing deals with the U.S., Germany and Britain to provide greater assistance to foreign tax authorities that are seeking information on their citizens’ accounts.