Business

Credit Suisse fined $30m for hiring of Chinese officials’ ‘princelings’

Credit Suisse has been fined $29.8m (£22.5m) by the US Securities and Exchange Commission (SEC) for employing so-called “princeling” relatives of Chinese government officials to “corruptly” influence them.

The Swiss bank engaged in a form of bribery when securing the employment for “relationship hires” or “referral hires”, bypassing normal hiring processes, the SEC said in a statement today.

The SEC investigation ran in parallel to a US Department of Justice (DoJ) probe, for which Credit Suisse was forced to pay out $47m in June, meaning the corruption cost the bank $77m in total.

Read more: Credit Suisse to pay US Justice Department $47m over Asia hiring practices

“Several senior Credit Suisse managers in the Asia-Pacific region” were involved in the scheme, hiring more than 100 employees to gain “millions of dollars” in revenues, the SEC said. The government officials would give the bank lucrative contracts in exchange for the employment.

Charles Cain, chief of the SEC enforcement division foreign bribery division, said: “Bribery can take many forms, including granting employment to friends and relatives of government officials. Credit Suisses practice of engaging in these hiring practices violated the law, and it is now being held to account for having done so.”

The DoJ previously described the programmes as “bribery by another name”.

The settlement ends Credit Suisses exposure on the issue. It follows similar settlements with US bank JP Morgan Chase, which paid $264m at the end of 2016 for violations of the USs Foreign Corrupt Practices Act

In a statement Credit Suisse said it is “pleased to have reached an agreement”. It continued: “With the previously announced US Department of Justice settlement, this puts this legacy matter behind the bank, and represents no material impact to Credit Suisse.

“The bank has implemented numerous enhancements to its compliance and controls function and remains committed to upholding the highest standards of integrity and fair business practices in every jurisdiction in which it operates.”

Read more: Credit Suisse profits surge as bosses hail cost-cutting drive

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CityAM

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