Credit Suisse fined USD 350 mln over loan scandal

Wednesday 20 October 2021 12:47 CET | News

Credit Suisse has been fined nearly GBP 350 million by global regulators, pleaded guilty to wire fraud.

The financial service company agreed to forgive hundreds of millions of dollars worth of debt owed by Mozambique to draw a line under the long-running ‘tuna bonds’ loan scandal.

The Swiss banking company had been accused of failings in its financial crime controls by the UK’s Financial Conduct Authority (FCA), and has entered into a deferred prosecution agreement with the US Department of Justice that will put the bank under heavy monitoring for three years after having ‘defrauded US and international investors’.

This is the bank’s latest attempt to put a series of scandals to rest under new leadership, which is still grappling with the fallout of the collapse of Greensill Capital and Archegos Capital earlier in 2021. The tuna bonds scandal arose from USD 1.3bn (GBP 940 million) worth of loans that Credit Suisse arranged for the Republic of Mozambique between 2012 and 2016. The loans were said to be aimed at government-sponsored investment schemes including maritime security projects and a state tuna fishery, located in the capital Maputo.

However, a portion of the funds were unaccounted for, with one of Mozambique’s contractors later found to have secretly arranged ‘significant kickbacks’ worth at least USD 137 million, including USD 50 million for bankers at Credit Suisse meant to secure more favourable deals on the loans, according to regulators.

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Keywords: payment fraud, regulation, financial services, financial crime, lending
Categories: Fraud & Financial Crime
Countries: World
This article is part of category

Fraud & Financial Crime

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