With much fanfare and publicity, the Federal Reserve Board on Monday announced that Credit Suisse will pay a $100 million penalty for unsafe and unsound practices and failing to comply with the federal banking laws governing its United States activities. Credit Suisse is also subject to a cease and desist order requiring Credit Suisse to address deficiencies in oversight and compliance with United States laws.
The Federal Reserve’s action was a joint effort with the Department of Justice and New York State regulators, which assessed penalties of $2.6 billion.
This case offers an important reminder that the compliance burden is significant and involves many federal and state levels of oversight. Although this is a unique case involving a major worldwide player and specific employees who engaged in the violative conduct, Credit Suisse has many layers of regulation it must consider beyond traditional banking laws.
Although the criminal component presented the most punitive fine, the $100 million fine from the Federal Reserve is a major penalty meant to deter this conduct.
If you have questions regarding the layers of oversight applicable to your institution, please contact Spilman or other knowledgeable counsel.