https://ift.tt/cOro6mD Suisse Faces Money Laundering Charges In Bulgarian Cocaine Traffickers Case – Cryptovibes.com – Daily Cryptocurrency and FX News

On February 7, charges of allowing an alleged Bulgarian cocaine trafficking gang to launder millions of euros, some of it stuffed into suitcases were leveled against Credit Suisse in a Swiss court.

Swiss prosecutors say that not all necessary steps to prevent the alleged drug traffickers from hiding and laundering cash between 2004 and 2008 were taken. Hence, the country’s second-biggest bank and one of its former relationship managers failed to prevent a crime.

In an official statement, the bank said:

“Credit Suisse unreservedly rejects as meritless all allegations in this legacy matter raised against it and is convinced that its former employee is innocent.”

Prosecutors, in the first criminal trial of a major bank in Switzerland, are seeking around 42.4 million Swiss francs in compensation from Credit Suisse (CSGN.S). The bank was quick to say that it would “defend itself vigorously in court”.

In Switzerland, where the case is seen as a test for a potentially tougher stance by prosecutors against the country’s banks, the case that carries such allegations has attracted intense interest.

The indictment centers on relationships that Credit Suisse and its ex-employee had with former Bulgarian wrestler Evelin Banev and multiple associates, two of whom are charged in the case, and it runs to more than 500 pages. The former relationship manager at Julius Baer is charged with facilitating money laundering in the second indictment in the case.

The case was unjustified and his client denied wrongdoing, as highlighted by a legal representative for the ex-Credit Suisse employee, who cannot be named under Swiss privacy laws.

In the Swiss federal court, the two alleged gang members faced charges of multiple counts of misappropriation, fraud, and forgery of documents but cannot be named under Swiss privacy laws, and their lawyer declined to comment. On the other hand, a lawyer for the former relationship manager at Julius Baer did not respond to requests for comment.

Despite not facing charges in Switzerland, Banev was convicted in Bulgaria in 2018 for being part of a criminal organization active in trafficking tons of cocaine from Latin America and before that in Italy in 2017 for drug trafficking.

Even after he vanished, he was arrested in September in Ukraine, Interpol’s red list of wanted person’s shows, from where Bulgarian prosecutors are seeking his extradition to face charges of setting up an organized criminal group and drug trafficking activities.

Both Banev and his legal representatives could not be reached for comment. His lawyer, who represented him in his Bulgarian trial, said she was no longer representing him. Regarding the case, Julius Baer (BAER.S), which is not facing charges, declined to comment.

CASH IN CASES

In the indictment, prosecutors allege that the former Credit Suisse employee brought at least one Bulgarian customer who was an associate of Banev with her when she joined Credit Suisse in 2004.

The indictment says that although he was later shot dead as he left a restaurant with his wife in Sofia, Bulgaria in 2005, the customer had begun placing suitcases full of cash in a safe deposit box at Credit Suisse.

The gang is alleged to have laundered money using the so-called smurfing, where a large sum of money is broken down into smaller amounts that are below the anti-money laundering alert threshold, putting millions of euros in small-value bills into safety deposit boxes and later transferring them into accounts.

After international pressure, Swiss private banks have since adopted much tougher anti-money laundering (AML), the so-called know-your-client (KYC) checks. However, the defendants said this was standard practice at the time the deposits were made.

The former relationship manager, who left Credit Suisse in 2010 after being detained for two weeks by police in 2009, is alleged to have been carrying out more than 146 million Swiss francs in transactions, including 43 million francs in cash to help conceal the criminal origins of money for the clients.

Attorneys at law firm MANGEAT LLC, representing the ex-employee, told Reuters.

“Our client is being unfairly accused because Swiss law requires that a person be implicated in order to condemn a bank. She is innocent, outraged by the accusations. We will plead for her full and complete acquittal.”

Saying that Banev and his circle operated legitimate businesses in construction, leasing, and hotels, Credit Suisse disputed the illegal origin of the money, a source familiar with its thinking told reporters.

After Banev was temporarily arrested in Bulgaria in April 2007, the Swiss bank, which the indictment says considered Bulgaria as a high-risk country at the time, intends to draw attention to calls made by its compliance department to Swiss prosecutors, the source added.

It hopes that the move by its compliance department will be viewed by the court as a sign of the bank taking its anti-money laundering obligations seriously and of cooperating with prosecutors in the matter. In response to a request from Bulgaria, the prosecutors asked Credit Suisse for information on accounts held by Banev and his associates in June 2007.

The bank’s compliance department, noticing a series of withdrawals, asked prosecutors whether to freeze the accounts, according to the source, but were told not to do so in order not to tip the clients off. Much of the money had been withdrawn by the time prosecutors gave Credit Suisse the go-ahead.

Saying the matter was now in the hands of the court, the prosecutors’ office declined to comment on Friday. Some of the funds are alleged to have been transferred to another Swiss bank, according to the second indictment filed by federal prosecutors against the former relationship manager at Julius Baer, which is being tried in the same court case.

In that context, the former relationship manager is charged with facilitating money laundering activities. He left a few months after the transfers took place. The indictment says that the defendants had offered a suitcase filled with cash to the bank but it refused to accept it.