Grencelle, Archigos, Mozambique – Credit Suisse scandals continue. Now the big bank is under pressure again: the former Georgian Prime Minister Bidzina Ivanishvili (65 years old) is demanding that the bank be found guilty of money laundering.
It all started harmoniously: since 2009, the Georgian billionaire entrusted his money to CS client advisor Patrice Lisodron (57). He managed the fortune of Eastern European super-riches – with so much success that he became a star banker. What Lescaudron’s clients did not know: he put their assets into high-risk investments, forged documents and threw money into his own pocket. The bank’s internal control system sounded the alarm several hundred times. But Lescaudron’s criminal activity did not end until 2015.
The fraudulent clients went to court – including the iron-ore oligarch Bidsina Ivanishvili, who served as Georgian Prime Minister from 2012 to 2013. It is said that Liskaudron caused him a loss of about 1 billion francs. Ivanishvili filed several criminal charges against the client’s advisor and the bank in Geneva.
Liskaudron was sentenced to five years in prison in 2018 for commercial fraud, gross breach of trust, mismanagement and securities fraud.
Credit Suisse resists
What about the bank? It has remained undisturbed to this day. The case is in the hands of Geneva prosecutor Yves Bertosa, 47, who has done little to no avail in the matter for five years. This relates primarily to the dispute over the 2017 Finma report on the Lescaudron case, as the Geneva prosecutor explains to SonntagsBlick. In fact, CS is strongly opposed to accepting this report, which was prepared on behalf of the CMA, as evidence in the ongoing proceedings.
The bank does this for understandable reasons: according to the comprehensive report, dozens of Lescaudron managers violated the rules, guidelines and instructions. Compliance, that is, observance of the rules, did not work. In 2018, Finma issued a sharp reprimand to CS: “Instead of timely and appropriately disciplining the client’s advisor for violations, the bank rewarded him with a high bonus and positive employee reviews.”
Ivanishvili CS accused of money laundering
This is exactly what Ivanishvili is aiming for: he accuses CS of failing to take joint responsibility for Lescaudron’s actions. The former prime minister had been doing this for years – but now he has stepped up: At the beginning of November, his lawyers in Geneva filed an additional criminal complaint against Credit Suisse for money laundering.
why now? “Because the investigations conducted by the Attorney General’s Office have made practically no progress since the original complaint against the bank in 2016, the lawyers told SonntagsBlick.” But time is of the essence. “Due to the imminent statute of limitations, Bidzina Ivanishvili was forced to prove the money laundering committed by Credit Suisse through a thorough investigation of unauthorized transactions on his accounts, which the Geneva prosecutor has not yet done,” the lawyers continued.
In fact, there is movement now at issue. Last Thursday, former President Lisodron had to appear before Bertosa for the first time as a media person. This will be followed by further hearings of several customer service employees, according to the Geneva prosecutor.
Pressure is growing for Finma’s report to be approved, too – from the outside: Liskaudron handled many of his criminal transactions through life insurance company Credit Suisse Life, based in Bermuda. There, the Supreme Court approved FENMA’s report as evidence in September.
However, the outcome of the actions depends not only on it. Another major hitch awaits Ivanishvili: Lescaudron has been convicted of various crimes – but not money laundering. As long as this crime is not proven, the accusation against the bank of joint responsibility for it hangs in the air.
Liskaudron acted alone
In Switzerland, no bank has ever been convicted of money laundering. Credit Suisse has refused a settlement with Ivanishvili. She confirmed to SonntagsBlick: “All investigations conducted into this matter since 2015 by the bank, Finma and criminal authorities have shown that the former client advisor was not supported by other employees in his criminal activities. On the contrary: the client advisor was paid directly from The plaintiff accepted for years without the bank’s knowledge. In the criminal proceedings that are now legally completed against the former client advisor, he has also not been convicted of money laundering.”
It is a presumption of innocence. A bank conviction would result in a fine of up to five million francs—a piece of cake for CS. But in the event that this really happens, Ivanishvili wants to claim compensation for the billion he lost. Then there is a lot at stake.
The president announces a change of course
After recent disasters, Credit Suisse has laid off high-level employees and expanded its control systems. New President Antonio Horta Osorio, 57, wants to introduce a new culture. Is the end of scandals now?
Matthias Binswanger (58), professor of economics at the University of Applied Sciences in northwestern Switzerland, is skeptical: “Further expansion of compliance departments only means more bureaucracy. This does not change the current system, it justifies it.” The underlying problem is the generous bonus payments, says Binswanger: “They keep pushing the risk appetite. As long as these incentives remain, there will be no change.”
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