WASHINGTON, D.C. — A Hong Kong investment bank will pay a $47 million criminal penalty to resolve allegations by the U.S. Department of Justice (DOJ) that the bank violated the Foreign Corrupt Practices Act (FCPA) when it awarded jobs to friends and family of Chinese officials.
The department said an FBI New York Field Office investigation found Credit Suisse (Hong Kong) Limited, a subsidiary of Credit Suisse Group AG (CSAG), a Swiss issuer of publicly traded securities in the U.S., hired, promoted and retained employment candidates who were related to government officials and executives of their clients as part of a quid pro quo.
“Credit Suisse (Hong Kong) Limited engaged in a corrupt scheme to win business with Chinese state-owned entities by hiring friends and family of Chinese government officials, generating the bank at least $46 million in profits,” DOJ acting assistant attorney general John Cronan said in a statement. “These ‘relationship hires’ often lacked necessary technical skills and offered fewer qualifications and significantly less relevant banking experience than other candidates for the jobs."
Several of the bank's senior managers in the Asia Pacific region had admitted to the "relationship hires" between 2007 and 2013, according to the DOJ.
Credit Suisse also settled with U.S. Securities and Exchange Commission (SEC) for related allegations, the department said.