Credit Suisse to pay $475 mn to settle US, UK charges on Mozambique bond offer
Credit Suisse has agreed to pay $475 million to US and British authorities to resolve charges of “fraudulently misleading investors” and violating anticorruption law in bond offerings in Mozambique, US officials announced Tuesday.
A unit of the big Swiss bank pleaded guilty to one count of conspiracy to commit wire fraud as part of a three-year deferred prosecution agreement between the parent company and with US criminal authorities, said the US Justice Department.
The transactions “that raised over $1 billion were used to perpetrate a hidden debt scheme, pay kickbacks to now-indicted former Credit Suisse investment bankers along with their intermediaries, and bribe corrupt Mozambique government officials,” said the Securities and Exchange Commission in a statement over a parallel civil case.
Credit Suisse bankers “falsely represented” to investors that proceeds from the loans would go exclusively to develop Mozambique’s tuna fishing industry and generate revenues to pay debt payments, said an SEC order.
In fact, Credit Suisse bankers received at least $50 million in kickbacks, part of at least $200 million in total kickbacks to players in the scandal that included Mozambican government officials, the SEC order said.
Credit Suisse officials also failed to disclose in investment documents the full extent of Mozambique’s indebtedness and the risk of default, the SEC said.
The announcement comes on the heels of two guilty pleas by former Credit Suisse bankers in 2019 for charges to commit money laundering and a guilty plea by a third banker for conspiracy to commit wire fraud.