The Justice Department said it was the largest penalty imposed in any criminal tax case. It is also the largest bank to plead guilty in more than 20 years.
The settlement resolves a yearslong criminal investigation into allegations that Credit Suisse, Switzerland’s second-largest bank, recruited U.S. clients to open Swiss accounts, helped them conceal the accounts from the IRS and enabled misconduct by bank employees.
The case is part of an Obama administration crackdown on foreign banks believed to be helping U.S. taxpayers hide assets.
Officials said a criminal charge was necessary to account for the bank’s pattern of misconduct, which included a lack of cooperation and document destruction. But the deal was structured to allow the bank to continue operating.
The penalties will be paid to the Justice Department, the Federal Reserve and the New York State Department of Financial Services.
“A company’s profitability or market share can never and will never be used as a shield from prosecution or penalty,” Attorney General Eric Holder told a news conference. “And this action should put that misguided notion definitively to rest.”
A Senate subcommittee investigation found that the bank provided accounts in Switzerland for more than 22,000 U.S. clients totaling $10 billion to $12 billion. The report said Credit Suisse sent Swiss bankers to recruit American clients at golf tournaments and other events, encouraged U.S. customers to travel to Switzerland and actively helped them hide their assets.
Credit Suisse chief executive Brady Dougan has said previously that senior executives were not aware that some bankers were helping U.S. customers evade taxes. More than a half-dozen former bankers have been charged for their role in aiding the tax evasion.
The U.S. government has been criticized for not been aggressive enough in its pursuit of banks. A Senate report accused the Justice Department of lax enforcement and faulted the government for gleaning only 238 names of U.S. citizens with secret accounts at Credit Suisse, or just 1 percent of the estimated total.
The charges come months after the U.S. government and Switzerland reached an agreement allowing Swiss banks to settle any potential U.S. charges if they disclose extensive information about their American clients, the value of their accounts and any help they received from tax professionals.
Those settlements would include penalties for Swiss banks that helped their U.S. clients avoid taxes, and the Justice Department also could use the information to prosecute Americans for tax evasion.
The agreement signed last summer was a significant step in the long-running dispute between the two countries. In it, Switzerland agreed to ease the legal barriers of its legendary bank secrecy laws in U.S. cases so that Swiss banks would be able to turn over customer data to the U.S. authorities. In return for providing the customer information, the Swiss banks could pursue legal settlements with the U.S. authorities and avoid criminal prosecution.
