UBS to pay $511 million fine over Credit Suisse tax case, exposing compliance gaps

A significant settlement in a U.S. tax fraud case against Credit Suisse contains numerous compliance lessons related to beneficial ownership and due diligence in mergers and acquisitions.

Credit Suisse and its parent bank, UBS, agreed to pay a total of $511 million in fines and enter a non-prosecution agreement (NPA) with the U.S. Department of Justice (DOJ), the agency announced Monday. This would settle long-standing allegations that Credit Suisse helped American high-net-worth customers hide the true ownership of $4 billion so they could avoid paying U.S. taxes.

As part of the NPA, UBS/Credit Suisse must “cooperate fully with ongoing investigations and affirmatively disclose any information it may later uncover regarding U.S.-related accounts,” the DOJ said. The agency also noted that “the agreements provide no protections for any individuals.”