Swiss prosecutors target Credit Suisse, now part of UBS, over Mozambique money laundering case

GENEVA (AP) — Swiss authorities on Monday said they have indicted a former official at Credit Suisse — now part of Swiss banking titan UBS — for alleged money laundering in a case involving state companies in Mozambique, and charged the bank with not doing enough to stop it.

Credit Suisse, which was merged into UBS two years ago, is said to have provided loans totaling more than $2 billion to three state-owned companies in the African country in 2013. Three years later, the deals became known as the “Mozambique Debt Scandal,” the Swiss attorney general’s office said, adding that it had opened a probe in 2020.

The indictment handed down on Nov. 25 centers on the transfer in 2013 of nearly $7.9 million from Mozambique’s Ministry of Economy and Finance to a Credit Suisse account in Switzerland. The vast majority of the funds were then transferred to accounts in the United Arab Emirates, the attorney general’s office said.

According to the indictment, the Credit Suisse compliance officer was aware of many signs that the funds from Mozambique “could be of felonious origin,” but recommended that top bank managers should not report the case to Switzerland’s money laundering reporting office, known as MROS, and simply “terminate” the commercial relationship.

Credit Suisse didn’t report the case to MROS until 2019, after the U.S. Justice Department announced criminal proceedings in connection with the Mozambique loans.

The attorney general’s office alleged that the negligence of the compliance officer, who was not named, allowed the funds to be laundered, and said Credit Suisse didn’t take “required and reasonable” measures to stop it.

UBS has been charged with being “criminally liable,” the office said.

In an email, UBS said: “We firmly reject the Office of the Attorney General’s conclusions and will vigorously defend our position.”

The attorney general’s office said it is conducting criminal proceedings against two other people in connection with the Mozambique case.

It was one of a string of troubles for Credit Suisse that led Swiss government officials and UBS to arrange the 2023 merger of Switzerland’s two biggest international banks. UBS has already mopped up other troubles at its now-defunct former rival, including by paying fines over Credit Suisse’s ties to collapsed hedge fund Archegos Capital Management two years ago.