Credit Suisse has revealed that its investigation into the options mispricing that it disclosed last month has uncovered serious internal control failings.
The Zurich-based bank announced a $2.85 billion write-off on wrongly priced trading positions in February, just a week after unveiling full-year results that made no mention of any problem. At the time it said a routine internal review had picked up the mistakes, the implication being that its controls had worked.
The bank now says that the errors were “in part, the result of intentional misconduct by a small number of traders.” It has dismissed or suspended these employees. The review also found that “the controls put in place to prevent or detect this activity were not effective.”
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