In the Credit Suisse surveillance scandal, a prosecutor reportedly wants to know why the bank's CEO Tidjane Thiam fell out with Iqbal Khan, one of his top executives.
The feud between Credit Suisse boss Tidjane Thiam and the man he tasked with the bank's main wealth arm until last June, Iqbal Khan, was long in the making. It boiled over into public view in September, when Khan confronted a private detective hired by the bank to tail him after the banker defected to UBS.
The stakes are high for Credit Suisse – but also for UBS, where Khan is now busy restructuring the wealth manager's flagship unit. A Swiss prosecutor is investigating two criminal complaints, and Switzerland's financial regulator Finma also began asking for answers after at least one more spy case emerged at Credit Suisse.
Loud Confrontation
The spat between the two Credit Suisse bankers, also neighbors in a cushy lakeside suburb of Zurich, first erupted in a New Year's cocktail held in Thiam's home last January. Zurich's prosecutor wants details of the confrontation, Swiss weekly outlets «Sonntagszeitung» (behind paywall, in German) and «Sonntagsblick» (in German) reported, separately.
Last year, several media outlets reported that the two men had a loud confrontation, during which both men's partners were present, over arborvitae shrubs on their shared property line. Khan, who is 43, reportedly felt Thiam's behavior towards him warranted police notification, but stopped short of alerting authorities.
Demanding Evidence
The prosecutor ordered a discovery of evidence shortly after the September scuffle between the private detective and Khan, according to the papers – which indicates she believes there is grounds to bring criminal charges.
Specifically, the prosecutor wrote, «Due to an ongoing criminal investigation and supported by media reports... I request all files related to the above-mentioned person {Iqbal Khan} or Tidjane Thiam since the beginning of 2019 be sent to me.»
Reason for Fear?
The prosecutor in Zurich didn't specify what the discovery found. The fact that evidence was requested is highly noteworthy: it is likely to raise the question of whether the Khan, after the September melee with the detective following him, felt threatened by the detective himself, or from the months-long testy relationship with Thiam.
Khan's criminal complaint, lodged in September shortly after the run-in with the private detective, includes a passage referring to «the complainant was subjected to massive threats against life and limb in the past.»
Sacking Key Lieutenant
The nature of the CEO's behavior towards his subordinate is unclear. Several people familiar with the relationship dynamic between the two men describe Khan as being intimidated by Thiam's behavior. Credit Suisse Chairman Urs Rohner mediated a peace treaty between the two bankers over the January confrontation – which reportedly led Khan to drop any plan of involving police.
The Swiss bank found its former operating chief Pierre-Olivier Bouée, singlehandedly coordinated the surveillance, for which it sacked him retroactively. The onslaught of media reports on the scandal make it unlikely that Credit Suisse can bury it anytime soon.
