Market News

Credit Suisse’s (NYSE:CS) Secret American Accounts Continue to Dodge the Bank

Story Highlights

Credit Suisse is already facing a slew of lawsuits and financial problems, which the new management is undertaking to settle. Amidst these issues, the re-emergence of the American client’s tax evasion lawsuit poses a big problem for the bank.

Swiss banking giant Credit Suisse Group AG (NYSE:CS) (DE:CSX) is facing heightened pressure from the U.S. Department of Justice (DOJ) regarding hidden accounts of American clients. The bank helped Americans evade taxes by opening secret accounts with it. Credit Suisse had pleaded guilty to the allegations back in 2014 and had also paid a fine of $2.6 billion then.

Nonetheless, years later, the same issue haunts the bank as the DOJ probes the possibility of more undeclared accounts at the bank. It is alleged that the bank has failed to properly report all hidden accounts, which has given them the leverage to transfer funds elsewhere without being tracked. Meanwhile, the bank is committed to clearing itself of the accusations and displaying its adherence to compliance.

A spokeswoman for the bank said, “Credit Suisse is in regular contact with the DOJ to report on the post-plea account remediation work undertaken pursuant to the bank’s 2014 plea… The bank has devoted substantial resources to these efforts and is committed to a continuous improvement culture regarding compliance.”

Is it a Good Time to Buy Credit Suisse?

Now may not be a good time to invest in the company as it is trying to streamline operations and clear its name from multiple lawsuits. On TipRanks, analysts have a Hold consensus rating on Credit Suisse stock currently.

Moreover, TipRanks’ Hedge Fund Trading Activity tool shows that confidence in Credit Suisse is currently Very Negative, as five hedge funds decreased their cumulative holdings of CS stock by 3.6 million shares in the last quarter.

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