Credit Suisse to Pay $536 Million Settlement For Violating US Sanctions With Secret Transactions from Iran, Libya, Cuba, Burma, and Sedan

The Justice Department says Credit Suisse will pay a $365 million settlement for violating US economic sanctions. According to US Attorney General and Manhattan District Attorney Robert Morgenthau, the bank carried out secret transactions from Cuba, Libya, Iran, Burma, and Sedan that allowed “rogue players access to US dollars.”

The Justice Department says Credit Suisse admits to violating the International Emergency Economic Powers Act. The probe has resulted in about $1 billion in fines for the banks involved in the case. Credit Suisse reportedly stopped doing this kind of business in 2005, cooperated with investigators, and took additional measures to prevent this type of activity from happening again.

Under Credit Suisse’s deferred prosecution deal, however, the investment bank could be subject to further prosecution if more problems arise.

Holder says Credit Suisse showed clients how to transfer payments without capturing the attention of US authorities. He also claims that Credit Suisse profited by disregarding the law. Among the illegal activities, according to the Manhattan’s district attorney’s office, Credit Suisse,

• Between 2002 and 2006, processed over $700 million in payments that were in violation of US sanctions.
• Processed $1.1 billion in payments while concealing their Iranian ties.
• Illegally invested $150 million for two banned state-affiliated banks, one in Sudan and another in Lebanon.

Several other banks are under investigation for disregarding US sanctions. Morgenthau promises these banks are facing harsh penalties. Earlier this year, Lloyds TBS agreed to pay $350 million for helping Sudan and Iran despite US sanctions. Last month, federal authorities confiscated about $500 million in real-estate and bank deposits from Alavi Foundation for allegedly facilitating intelligence and financial activities for Iran. In 2008, a Manhattan federal court froze $2 billion that Citigroup was allegedly holding for Iran.

Related Web Resources:
Credit Suisse fine bigger w/o cooperation- US, Forbes/Reuters, December 16, 2009
Credit Suisse’s Secret Deals, The Wall Street Journal, December 17, 2009
International Emergency Economic Powers Act

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