Bloomberg News reported that the alleged compliance failures related to UBS and Credit Suisse, which was taken over by UBS early this year.
The Bloomberg report said a full-scale investigation by the Department of Justice focusing mainly on Credit Suisse and potential sanctions violations was now underway.
Trading in UBS shares was halted temporarily after they fell nearly 8% following the report. They later recovered to trade 3.4% lower at 12.33 GMT.
UBS declined to comment to Reuters.
In its latest financial report at the end of August, UBS said its sanctions programmes are designed to comply with sanctions across multiple jurisdictions, “including those imposed by the United Nations, Switzerland, the European Union, the UK and the United States.”
Switzerland’s largest bank also said in the report that Credit Suisse offices in Britain, Netherlands, France and Belgium, have been contacted by law enforcement officials as part of an investigation into cross border banking for rich clients, without giving details.
“Credit Suisse has conducted a review of these issues, the UK and French aspects of which have been closed, and is continuing to cooperate with the authorities,” the bank said in its report.
Bloomberg’s report, citing people familiar with the matter, said the DOJ had spoken to US-based lawyers for UBS about Credit Suisse’s alleged exposure to sanctions violations since UBS acquired its smaller rival in June.
The DOJ is also looking into possible compliance failures at UBS, one of the people cited by Bloomberg said.
The people also said the investigation was still in the early stages, and might not result in a charges or a settlement.
Bloomberg’s report said the DOJ probe covers both restrictions imposed after Russia’s invasion of Ukraine in 2022 and previous rounds put in place following its 2014 annexation of Crimea.
Source: Economy - investing.com
