Swiss prosecutors file charges against Credit Suisse and UBS

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Swiss prosecutors have filed charges against Credit Suisse and its owner UBS over alleged regulatory “deficiencies” linked to a nearly $7 million payment at the heart of Mozambique’s $2 billion “tuna bond” scandal.

Credit Suisse, which was acquired by Swiss rival UBS in 2023, failed to maintain adequate controls and did not report the suspicious transaction until 2019, the prosecutor’s office said.

In his statement, the prosecutor alleged that Credit Suisse, its parent group and its successor companies at UBS “failed to prevent crime due to regulatory deficiencies.”

Prosecutors also charged a former Credit Suisse compliance officer with money laundering for allowing $7 million to be sent to the UAE in 2016, after $7.8 million was first paid into a corporate account at a Credit Suisse Group entity.

The tuna bond issue stems from a $2 billion deal in 2013 under which Mozambique – one of the world’s poorest countries – borrowed heavily from international investors to finance maritime security projects and the government’s tuna fishing fleet.

However, much of the money was secretly misused, with officials and bankers accused of receiving bribes and leaving the country in huge debt.

The case represents the most significant action taken by Switzerland to date related to the scandal, which involved more than $2 billion in state-backed loans.

“We strongly reject the conclusions of the Attorney General’s Office and will vigorously defend our position,” UBS said in a statement.

In 2023, UBS agreed to a settlement with Mozambique over Credit Suisse’s involvement in a ship financing scandal, putting an end to a dispute that extended to the bank’s 2013 financing of a coastal patrol force and a tuna fishing fleet.

UBS is settling a long list of legal disputes it inherited after bailing out Credit Suisse in 2023. The takeover has saddled Switzerland’s largest bank with several legacy issues, including regulatory investigations, investor lawsuits and misconduct allegations dating back more than a decade.

The lender has already settled many of these old legal issues. In August, UBS agreed to pay $300 million to resolve a US case involving the mis-selling of residential mortgage-backed securities by Credit Suisse in the run-up to the 2008 financial crisis.

UBS also agreed in May to pay $511 million after a US Justice Department investigation into how Credit Suisse helped wealthy Americans hide more than $4 billion from authorities.