POSTED: 07:56 p.m. HST, Feb 25, 2014
LAST UPDATED: 08:13 p.m. HST, Feb 25, 2014
WASHINGTON » An elevator controlled remotely. A bank office referred to by its code name. A sheaf of bank statements hidden in the pages of Sports Illustrated.
At times, a Senate report into how Credit Suisse, a bank based in Zurich, helped its American customers hide billions of dollars of assets from the U.S. Treasury reads more like a John Grisham novel than a white paper.
The report, the product of a two-year investigation, was released on Tuesday by the Senate Permanent Subcommittee on Investigations. The report contends that the bank actively helped thousands of Americans conceal their wealth offshore.
Brady W. Dougan, the chief executive of Credit Suisse, and other top bank officials are scheduled to appear along with two Justice Department officials at a hearing on the report on Wednesday.
"It's time to ramp up the collection of taxes due from tax evaders on the billions of dollars hidden offshore," Sen. Carl Levin, D-Mich., the subcommittee's chairman, said in a statement.
The report is scathing both to the financial institution and to U.S. law enforcement, which the subcommittee accuses of dragging its feet in holding the bank and the relevant taxpayers accountable.
The 176-page report charges that from at least 2001 through 2008, the Swiss bank helped its U.S. customers evade taxes through a variety of means, including opening accounts in the name of "shell" companies and sending Swiss bankers to the United States to "secretly" recruit new clients and avoid creating a paper trail.
The report describes one instance in which a Credit Suisse banker "traveled to the U.S. to meet with the customer at the Mandarin Oriental Hotel and, over breakfast, handed the customer bank statements hidden in a Sports Illustrated magazine."
The bank's New York office also "kept a document listing 'important phone numbers' of intermediaries that formed offshore shell entities for some of the bank's U.S. customers" and urged U.S. customers to come to Switzerland to do their banking, opening a full-service office in the Zurich airport, the report said.
"Financial institutions like Credit Suisse have profited from their offshore tax haven schemes while depriving the U.S. economy of billions of dollars in tax revenues," Sen. John McCain, R-Ariz., the subcommittee's ranking Republican member, said in a statement.
The Senate report may put additional pressure on the Justice Department to prosecute or settle with the Swiss banks and bankers it has investigated for aiding tax avoidance.
The Justice Department indicted several Credit Suisse bankers on charges of aiding tax evasion in 2011, and it is also investigating the bank itself. Credit Suisse is expected to settle with the Justice Department this year.
Credit Suisse did not respond on Tuesday to a request for comment on the Senate report.