First, it was BNY Mellon Corp. in August 2015 for $14.8 million (see here and here for prior posts). Then, it was Qualcomm in March 2016 for $7.5 million (see here and here for prior posts). Then, it was JPMorgan in November 2016 for $202.6 million (see here, here, and here for prior posts).
Next up in Foreign Corrupt Practices Act enforcement actions (mostly targeting the financial services industry) focusing, in whole or in part, on internship and hiring practices being a form of bribery is Credit Suisse as the DOJ and SEC officially announced today (see here and here) the expected enforcement action (see here).
If you were wondering whether this “scurrilous and hypocritical” form of FCPA enforcement action (as stated by a former SEC Chairman see here) would carry forward to the Trump administration, you now have the answer.
As highlighted in this post, the approximate $77 million enforcement action involved:
- a DOJ non-prosecution agreement against Credit Suisse (Hong Kong) Limited (“the Company”) resolved with a $47 million criminal penalty; and
- an SEC administrative order against Credit Suisse Group AG (“CSAG”) resolved through a payment of approximately $29.8 million (approximately $25 million in disgorgement and approximately $4.8 million in prejudgment interest).
Credit Suisse (Hong Kong) Limited is described in the NPA as follows:
“a Hong Kong-registered company and wholly-owned subsidiary of CSAG. Credit Suisse offered securities products and financial advisory services in the Asia-Pacific (“APAC”) region under the “Credit Suisse” brand. Credit Suisse (Hong Kong) Limited was an “agent” of an issuer within the meaning of the FCPA. Many of Credit Suisse’s clients in China were state-owned enterprises (“SOEs”), which were owned and controlled by the government of China and which performed a function that the government treated as its own, and thus were each an “instrumentality” within the meaning of the FCPA.”
The NPA generically identifies the following “Relevant Credit Suisse Clients, Regulators, and Government Officials.”
“SOE #1” was a state-owned power company incorporated in Hong Kong and supervised by the Chinese government under State-owned and controlled “Agency A.” SOE #1 was a subsidiary of another state-owned power company, and it was an “instrumentality” within the meaning of the FCPA. SOE #1 was a client of Credit Suisse.
“Foreign Official #1” was a high-ranking official at SOE #1, and a close relative of a former, prominent senior Chinese official. Foreign Official #1 was a “foreign official” within the meaning of the FCPA.
”SOE #2” was a diversified holding company registered in Hong Kong and owned by the Chinese government under the supervision of Agency A. SOE #2 held a number of operating business units and subsidiaries based in China and it was an “instrumentality” within the meaning of the FCPA. SOE #2 was a client of Credit Suisse.
“Foreign Official #2” was a high-ranking official at SOE #2, who also held board roles with a number of SOE #2’s subsidiary companies. Foreign Official #2 was a “foreign official” within the meaning of the FCPA.
“Agency B” was a Chinese government executive agency that administered macroeconomic policy, budget, and government expenditures. Agency B oversaw most SOEs and SOE-related transactions, and was often a necessary signatory to investment banking transactions involving Chinese SOEs.
“Foreign Official #3” was a high-ranking official at Agency B. Foreign Official #3 was a “foreign official” within the meaning of the FCPA.
“SOE #3” was a state-owned investment holding company headquartered in Beijing, China and an “instrumentality” within the meaning of the FCPA. SOE #3 was a client of Credit Suisse.
“SOE #4” was a large, state-owned power company in China. It was a client of Credit Suisse and an “instrumentality” within the meaning of the FCPA.
The three year NPA (which was executed by the Credit Suisse on May 29th and by the DOJ on May 30th) states under the heading “Overview of Scheme” as follows:
“In or about and between 2007 and 2013, several senior Credit Suisse managers in APAC engaged in a practice to hire, promote, and retain candidates referred by, related to, or otherwise connected with clients, potential clients, and government officials (known as “referral hires” or “relationship hires”), as part of a quid pro quo, whereby Credit Suisse bankers sought to win business from the referral sources. Employees in other CSAG subsidiaries and affiliates were aware of certain of these “relationship hires,” and their hires, promotions, and remuneration were approved by certain of these employees.
During this time, the aforementioned Credit Suisse managers decided to recommend hiring certain referral hires before conducting interviews or vetting a candidate’s qualifications, and instead made hiring decisions principally on the basis of securing business, including specific business mandates from the referring official’s employer. For example, one SOE executive emailed a senior Credit Suisse banker to refer a candidate who had a “very good and close relationship” with senior management at the SOE, and wrote that hiring the referral hire would “bring [Credit Suisse] the big surprise in the near future if you could coordinate with CS Asian team to arrange a position in CS team in Beijing.” The senior Credit Suisse banker later told a colleague about an impending deal that the SOE was pursuing and explained that the referring SOE official “was focused on having us make a relationship hire and said it was very important for us to win future business with [the SOE].”
Credit Suisse managers in APAC instructed subordinate employees to engage in practices to give the appearance that normal hiring processes were being followed for referral hires when they were not. For example, on one occasion a Credit Suisse manager instructed a subordinate employee to draft a resume for a referral hire candidate. On at least one other occasion, Credit Suisse managers instructed subordinate employees to artificially inflate ratings for a referral hire during employment interviews or score individuals highly on hiring forms, regardless of their actual abilities or interview performance.
Certain referral hires of government and SOE clients were prioritized based on the understanding and expectation that officials at these clients would reward Credit Suisse with business, and some were deemed a “must hire” even though that term was reserved for exceptional interviewees, which they were not.
Credit Suisse maintained spreadsheets that listed ”referral hires” or “relationship hires.” These spreadsheets included information identifying the referring client or relationship when the relationship was with a government regulator. Some of these spreadsheets identified the “[c]ontribution” of the referral hire, including in at least three instances, deals specifically attributable to the relevant relationship. In an email to colleagues, a Credit Suisse employee explained: “Relationship hires have to translate to $” or “the relationship is worthless to our organization.” In a different email, a senior Credit Suisse banker stated that a referral hire “will get us a US$1bn bond deal. . . . His family requested to change his status to permanent with CS. Given  the level of importance of this deal, we will decide to renew his contract for another 24 months instead of permanent.”
Credit Suisse’s referral hires often lacked technical skills, were less qualified, and had significantly less banking and other relevant experience than candidates hired through Credit Suisse’s other employment channels.
After the initial hiring of certain referral hires, Credit Suisse continued to provide these referral hires with additional benefits and promotions, including at the request of certain SOE or other government officials, even though these referral hires had performed poorly or were not otherwise suited to receive such benefits or promotions.
As a result of the above-mentioned conduct, Credit Suisse received investment banking mandates from Chinese SOEs whose executives referred or were connected to candidates hired by Credit Suisse. Credit Suisse earned over $46 million in revenues from those mandates.”
According to the NPA:
“As early as 2007, Credit Suisse’s Global Anti-Bribery Policy specified that “[o]ffers of employment, including internships, to Government Officials, their family members, or associates,” could be considered to be “things of value” under the FCPA, and were prohibited if offered “to obtain or retain business, or otherwise secure an improper advantage.”
The NPA then contains “examples of Credit Suisse’s Corrupt Hiring Practices” concerning “Referral Hire #1, Referral Hire #2, Referral Hire #3, and Referral Hire #4.”
As to “Referral Hire #1,” the NPA states in pertinent part:
“Referral Hire #1 was the daughter of Foreign Official #1, a high-ranking official at SOE #1, which was the controlling shareholder of Chinese Company #1.”
Referral Hire #1 would receive a first year analyst salary and a housing allowance, respectively approximately $70,000 and $30,000 annually.
On or about July 1, 2010, Referral Hire #1 began working at Credit Suisse, without having received any screening or approval from the Credit Suisse Legal and Compliance Department (“LCD”) or any other compliance body. During her probationary period, Referral Hire #1 exhibited unprofessional behavior. In connection with a July 2010 training, Credit Suisse employees complained that she failed to attend a mandatory boot camp, brought her mother to training events, and left early. One Credit Suisse employee wrote that she received the worst grade in the class on an assessment, commenting that “from the looks of her assessment she didn’t even try (she filled in a pattern of 5As in a row, 5 Bs in a row, etc. on the answer key).” Less than a month later, in or around early August 2010, Referral Hire #1 and another intern made “the same exact error which nobody makes” on a homework assignment, and it was “apparent that they shared an Excel file and cheated on the homework.” On or about August 5, 2010, after a Credit Suisse employee reported that Referral Hire #1 “has been leaving at 4 pm right after every lecture every day this week while the rest of the class is working until at least 9pm, 10 pm” and that she “has yet to show up to training today,” Employee #2 commented, “[Referral Hire #1] is the most famous intern ever.” Notwithstanding these performance issues during the probationary period, in or around early October 2010, Referral Hire #1’s employment was fully approved, and both Employee #1 and another employee vouched for her performance.
During her tenure at Credit Suisse, Referral Hire #1 received multiple promotions, and Credit Suisse “fast tracked” her promotions by changing her class year. Referral Hire #1 remained at Credit Suisse until her resignation on or about May 31, 2015. In sum, Credit Suisse paid Referral Hire #1 over $1 million in total compensation.”
As to “Referral Hire #2,” the NPA states that he was “referred by Foreign Official #2, a high-ranking official at SOE #2” and that “Credit Suisse provided Referral Hire #2 a full-time position in Hong Kong with a salary of approximately $90,000.” According to the NPA:
“During Referral Hire #2’s four years of employment at Credit Suisse, senior bankers repeatedly emphasized to their colleagues the importance of including Referral Hire #2 in all matters related to SOE #2, referring to ways Referral Hire #2 could be “leveraged” or included on transactions for which Referral Hire #2 lacked relevant banking experience and expertise.
During Referral Hire #2’s period of employment with Credit Suisse, Referral Hire #2 was paid approximately $1.5 million in total compensation. During that same period, Credit Suisse was mandated on five SOE #2 deals, earning over $29 million dollars.”
As to “Referral Hire #3,” the NPA states that she was the “daughter of Foreign Official #3, a high-ranking official at Agency B. According to the NPA:
“[Credit Suisse offered] offer Referral Hire #3 an 18-month contract for a paid position at an approximate salary of $70,000 per year with a $30,000 yearly housing allowance eligible for bonuses and a relocation expenses … Referral Hire #3 began working at Credit Suisse in March 2010″ and frequently received bonuses or salary increases.”
As to “Referral Hire #4,” the NPA states in pertinent part:
“In or about June 2010, Credit Suisse hired Referral Hire #4 as a referral hire from SOE #4 in order to obtain business from SOE #4. Referral Hire #4’s hire was arranged by Credit Suisse in or around the summer of 2010, with Employee #3’s approval, and Referral Hire #4 was to start as an Associate with a promotion to Vice President (“VP”) that same year.
Referral Hire #4 was terminated approximately one year after starting at Credit Suisse.”
Pursuant to the NPA , the Company agreed to pay a “monetary penalty in the amount of $47,029,916 to the United States Treasury … The monetary penalty is based upon profits of at least $46,107,761 as a result of the offense conduct, and reflects a discount of 15% off of the bottom of the U.S. Sentencing Guidelines fine range.” Pursuant to the NPA, Credit Suisse agreed to report to the DOJ “at no less than 12 month intervals during the three-year term, regarding remediation and implementation of the compliance program and internal controls, policies, and procedures” set forth in the NPA.
The NPA was “based on the following facts and circumstances”
(a) the Company did not receive voluntary disclosure credit because neither it nor CSAG voluntarily and timely disclosed to the Offices the conduct described in the Statement of Facts;
(b) the Company received partial credit for its and CSAG’s cooperation with the Offices’ investigation, including credit for conducting an internal investigation, making factual presentations to the Offices, voluntarily making foreign-based employees available for interviews in the United States, producing documents to the Offices from foreign countries in ways that did not implicate foreign data privacy laws, providing translations of foreign language documents, and collecting and presenting evidence to the Offices; however, the Company did not receive full cooperation credit because its cooperation was reactive, instead of proactive;
(c) by the conclusion of the investigation, the Company and CSAG provided to the Offices all relevant facts known to them, including information about individuals involved in the misconduct;
(d) the Company and CSAG implemented remedial measures, including: (1) adopting additional controls related to their hiring programs; (2) implementing procedures in the Asia Pacific region in 2013, and globally in 2015, to ensure the identification of and anti-corruption vetting for all candidates referred for employment by government officials and employees of state-owned enterprises (“SOEs”); (3) requiring all candidates for employment to be screened by an independent service for connections to government officials, SOE employees and other “politically exposed persons” (“PEPs”) and verifying the efficacy of this screening; (4) requiring additional post-hire controls on employees linked to government officials and SOE employees, such as ring fencing them from work involving such officials and SOE employees, and requiring compliance personnel to track their performance; (5) requiring and conducting periodic reviews of hiring controls, and developing procedures for the regular evaluation of hiring controls; (6) conducting yearly headcount reviews to ensure accurate record-keeping concerning hiring; and (7) requiring improved Foreign Corrupt Practices Act (“FCPA”) and anti-corruption training for all staff, including job-specific training for bankers, recruiters, human resources, and compliance personnel. However, the Company did not receive full credit for remediation because it did not sufficiently discipline employees who engaged in the misconduct, and instead only recorded policy infractions internally and provided notices of infractions to three employees.
(e) the Company and CSAG have enhanced and are committed to continuing to enhance their compliance programs and internal controls, including by ensuring that their compliance programs satisfy the minimum elements set forth in Attachment B to [the NPA] (“Corporate Compliance Program”);
(f) based on the state of the Company’s and CSAG’s compliance programs, and the Company’s and CSAG’s agreement to report to the Offices as set forth in Attachment C to [the NPA] (“Corporate Compliance Reporting”), the Offices determined that an independent compliance monitor was unnecessary;
(g) the nature and seriousness of the offense conduct; and
(h) the Company and CSAG (on behalf of itself and through its subsidiaries and affiliates) have agreed to continue to cooperate with the Offices in any ongoing investigation of the conduct of the Company, CSAG, and their subsidiaries and affiliates and their officers, directors, employees, agents, business partners, and consultants relating to violations of the FCPA;
(i) accordingly, after considering (a) through (h) above, the Offices believe an appropriate resolution of this case is a non-prosecution agreement for the Company and an aggregate discount of 15% off of the bottom of the U.S. Sentencing Guidelines fine range.”
In the DOJ release, Acting Assistant Attorney General John Cronan of the Justice Department’s Criminal Division stated:
“Credit Suisse (Hong Kong) Limited engaged in a corrupt scheme to win business with Chinese state-owned entities by hiring friends and family of Chinese government officials, generating the bank at least $46 million in profits. These ‘relationship hires’ often lacked necessary technical skills, and offered fewer qualifications and significantly less relevant banking experience than other candidates for the jobs. The Department of Justice remains steadfast in our commitment to combatting bribery and corruption in all its many forms, including where companies engage in corrupt hiring practices to gain the favor of foreign officials to generate improper business advantages and increase profits.”
U.S. Attorney Richard Donoghue of the Eastern District of New York stated:
“Credit Suisse Hong Kong’s practice of employing friends and family members of Chinese government officials as a quid pro quo for lucrative business opportunities was both profitable and corrupt and now the company will pay the price for that corruption. This Office is committed to holding companies that conduct business in the United States accountable when they or their subsidiaries corruptly influence foreign government officials for financial gain.”
William Sweeney Jr. (Assistant Director-in-Charge of the FBI’s New York Field Office) stated:
“In the banking industry, not every undertaking is fair game. Trading employment opportunities for less-than-qualified individuals in exchange for lucrative business deals is an example of nepotism at its finest. The criminal penalty imposed today provides explicit insight into the level of corruption that took place at the hands of Credit Suisse Group AG’s Hong Kong-based subsidiary.”
The enforcement action was based on the same core conduct as the DOJ enforcement action. In summary fashion, this SEC order states:
“This matter concerns violations of the anti-bribery and internal accounting controls provisions of the Foreign Corrupt Practices Act (“FCPA”) by Credit Suisse. Between at least 2007 and 2013, Credit Suisse provided valuable employment to the relatives and friends of certain foreign government officials in the Asia-Pacific region (“APAC”) as a personal benefit to the requesting officials in order to obtain or retain investment banking business or other benefits for the bank. Because many of Credit Suisse’s clients were state-owned entities (“SOEs”), and because the individuals personally requesting employment or internships for their relatives and friends were either executives of these SOEs or were foreign government ministers with influence over the business decisions of SOEs, the requesting individuals were foreign government officials under the FCPA. Credit Suisse provided these jobs to certain of the referred candidates (“Referral Hires”) with the intent to corruptly influence the foreign government officials making the requests to secure banking business from the SOEs. Credit Suisse’s referral hiring practice resulted in multiple deals and substantial profits for Credit Suisse.
While Credit Suisse had written policies beginning in at least 2007 that prohibited the hiring of candidates referred by or related to officials from SOEs or government ministries in order to obtain or retain business, those policies were not meaningfully enforced. At least one senior Credit Suisse manager in APAC believed that restrictions on referral hiring — including a proposed requirement that all Referral Hires be vetted through the established, merit-based campus recruiting program — would “kill” their business. Steps were taken to make certain Referral Hires from SOEs appear to be normal, merit-based hires at Credit Suisse. The candidates would undergo interviews and submit their applications through Credit Suisse’s human resources department (“Human Resources”). However, in some instances, certain senior bankers made decisions to recommend hiring referrals in advance of this process and based on the prospect of business from the referring SOE rather than the merit of the prospective employee. Since the company’s prohibition on improper SOE Referral Hires was not implemented in practice, many client referrals were hired by Credit Suisse without the requirement of any review by the bank’s Legal and Compliance Department (“LCD” or “legal and compliance”) to ensure compliance with the bank’s policies.
During the six-year period referenced above, Credit Suisse offered employment to more than 100 individuals referred by or who had some connection to APAC foreign government officials. This included more than 60 employees and interns referred by foreign government officials at more than 20 different Chinese SOEs. Credit Suisse HK and its affiliates obtained deals from referring officials’ SOEs totaling tens of millions of dollars in revenue during this period. Credit Suisse also hired referrals from numerous government agencies. In exchange these government officials assisted Credit Suisse in navigating complex regulatory landscapes in order to obtain or retain business. Senior Credit Suisse managers in APAC tracked the success of some of the bank’s Referral Hires in generating business through the use of spreadsheets that linked particular referral hires to specific business deals for the firm. Certain senior personnel with Credit Suisse HK and in the U.S. were aware that referral hiring was taking place in the APAC region.
Credit Suisse’s internal accounting controls were insufficiently devised or maintained to reasonably enforce or effectuate the policies against Referral Hires or bribery of foreign officials and were therefore inadequate to address the corruption risks the company had identified in connection with referral hiring. The written restrictions put in place by Credit Suisse to minimize compliance and FCPA risks were not sufficient to curb Credit Suisse’s corrupt referral hiring practices.”
Under the heading “Credit Suisse’s Written Policies Prohibited the Hiring of Government Referrals in Exchange for Business,” the order states:
“As early as 2007, Credit Suisse recognized the FCPA risks in hiring the relatives of foreign government officials. Credit Suisse’s Global Anti-Bribery Policy (the “Global Policy”) specified that “[o]ffers of employment, including internships, to Government Officials, their family members, or associates,” could be considered to be “things of value” under the FCPA, and were prohibited if offered “to obtain or retain business, or otherwise secure an improper advantage.” The Global Policy was also reflected in regional policies applicable in APAC that recognized the bribery risks inherent in referral hiring and specified additional restrictions on the practice.
In 2011, the Global Policy was updated to specify that ad hoc training activities and internships for relatives of government officials that were clients both fell within the scope of prohibited employment practices. The updated Global Policy stated that such referrals could only qualify for positions in existing campus or lateral hiring programs with open application processes and that no special treatment could be provided for those referrals in the recruiting process.”
Under the heading “Senior Credit Suisse Managers in APAC Knew About Prohibitions Regarding Government Hires,” the order states:
“Credit Suisse HK senior managers were aware that hiring referrals from SOEs and government ministries to obtain or retain business was restricted under Credit Suisse’s written compliance policies and could violate the FCPA. For example, in an April 2009 e-mail, a Credit Suisse Banker wrote that “[g]iven the importance of these two referrals, I’m thinking whether we should add them to the regular intern program. Can we make two more spaces?” A Credit Suisse employee responded that “[g]iven the LCD resistance on the hiring of gov’t related interns, we should clarify how the individuals are related to these entities. We can then decide the best course of action.”
Additionally, in a May 2009 e-mail LCD informed APAC senior managers that Credit Suisse was unable to provide summer internships to two SOE client referrals because: “[a]fter consultation with the Bank’s Anti Corruption Team in New York, LCD in [sic] have deemed both requests to be potential violations of the Foreign Corrupt Practices Act and as such are too risky a venture for the Bank to pursue.” The LCD representative went on to describe why the two proposed hires could violate the FCPA, and concluded: “I am sorry for this news, however given the increased attention the regulators are now dedicating to this area and the fact that all of our key competitors have either disbanded their similar programmes, or are in the final stages of doing so, [LCD] in deeming the provision of these types of work experience or internships to FCPA subject parties to be too great a risk to enter into are simply adhering to what is now the industry practice.” 11. Also, in April 2010 LCD officials informed a Human Resources officer of a problem with hiring a client referral from an Indonesian SOE, noting “[a]s such, there is a blanket ban on offering these internships to anyone with direct government or SOE relations.”
Under the heading, “Credit Suisse HK Personnel Developed a Referral Hiring Practice to Hire SOE Referrals Without Proper Scrutiny,” the order states in pertinent part:
“From at least 2007 through 2013, multiple senior Credit Suisse managers in APAC engaged in a practice of hiring, promoting and retaining government-connected Referral Hires as part of a quid pro quo by which Credit Suisse managers sought to improperly influence foreign officials to assist Credit Suisse in winning lucrative investment banking mandates.
Rather than enforce Credit Suisse’s anti-corruption policies, senior Credit Suisse managers repeatedly took steps to onboard Referral Hires from SOEs and government ministries independently from the scrutiny of the company’s established, merit-based campus recruiting program. A 2009 e-mail from a Credit Suisse HK Human Resources executive to two Credit Suisse HK senior managers on “Client interns” stated: “One of LCD’s recommendations will be to hire the client interns through the formal Summer Programme for Analyst & Associates (managed by campus recruiting). We think this is not a great idea… we think it would be better if we could hire these interns independently (as in the past) for this summer. We can agree with LCD a new way to approach this for next year.” This practice persisted for the ensuing years.
APAC Credit Suisse senior managers at times agreed in principle to hire a referred candidate before conducting interviews or vetting of any kind, based on business advantages the government official who referred the candidate could provide. Senior Credit Suisse managers in APAC engaged in sham practices intended to give the appearance of a regular hiring process being followed. Senior Credit Suisse managers in APAC instructed subordinates to conduct interviews of referral candidates and automatically score the candidate highly, regardless of his/her actual performance.
In seeking approval to hire or promote a referred candidate, rather than highlighting the skills or experience of the candidate, Senior Credit Suisse managers in APAC referenced particular business or mandates that had been or could be gained as a result of the Referral Hire.
Many candidates were offered full-time salaried positions and paid internships that were eligible for bonuses, housing allotments, and other benefits, and some were hired without any approval or vetting from the LCD or any other compliance body.”
Under the heading “Credit Suisse HK Control Failures,” the order states:
“Credit Suisse’s compliance policies governing the bank’s referral hiring practices highlighted the corruption risks associated with referral hiring, and dictated that Credit Suisse HK could employ government-connected Referral Hires under only very limited circumstances. From at least 2007, the Global Policy prohibited offering a job or internship to any foreign official or relative of a foreign official to obtain or retain business or otherwise for improper purposes.
In light of the corruption risks identified in its own compliance policies, Credit Suisse placed written requirements around the onboarding of Referral Hires. Despite these written requirements, senior Credit Suisse managers in APAC repeatedly made Referral Hires in order to obtain banking business and other advantages from senior officials at SOEs and government agencies.
Certain Credit Suisse managers in the U.S. were aware of Credit Suisse HK’s hiring of client referrals, some of whom treated the job as a mere “boondoggle.” For certain Referral Hires, Credit Suisse senior managers in the U.S. approved the hire and took him or her on in the United States. This led to complaints from Credit Suisse U.S. bankers due to the frequency of the requests and the poor quality of the Referral Hires. For example, one senior U.S. Credit Suisse banker wrote: “. . . to be honest, we have had really bad experiences with many of the individuals from Asia . . . [a particular Credit Suisse HK senior manager] generates most of them and there is enough frustration in the system over this at this point that I wanted to check in with you for a sanity check on whether we should always break the mold for his requests or not . . . .”
In making Referral Hires, Credit Suisse repeatedly deviated from its established, merit-based hiring requirements which assessed job candidates based purely on qualifications and expected job performance. Credit Suisse failed to take adequate steps to mitigate known risks of bribery and corruption in its APAC operations. Credit Suisse HK failed to meaningfully implement or enforce Credit Suisse’s policies until 2013.”
Based on the above as well as the sore core conduct alleged in the DOJ action, the SEC’s order finds that Creduit Suisse violated the FCPA’s anti-bribery provisions and internal controls provisions.
In the SEC release, Charles Cain (Chief of the SEC’s FCPA Unit) stated:
“Bribery can take many forms, including granting employment to friends and relatives of government officials. Credit Suisse’s practice of engaging in these hiring practices violated the law, and it is now being held to account for having done so.”
The SEC’s order states:
“The Commission has considered the remedial efforts undertaken by Credit Suisse to enhance its internal accounting controls as well as its global implementation in 2015 of procedures intended to ensure that all job candidates are assessed based purely on merit, qualifications and expected job performance.”
“[Credit Suisse] acknowledges that the Commission is not imposing a civil penalty based upon the imposition of a $47 million criminal fine as part of Credit Suisse’s settlement with the United States Department of Justice.”
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