A prominent American financial regulator sees more nuance in the Swiss bank's Mozambique scandal than the agency she works for does.
Hester Peirce is living up to her reputation for raising uncomfortable questions at the Securities and Exchange Commission, where she is one of five chiefs. The U.S. lawyer says she is troubled by the pressure on compliance officials resulting from a weighty regulatory sanction over criminal wrong-doing in Mozambique.
«We may be placing undue pressures on CCOs,» or chief compliance officers, Peirce wrote in a statement on the SEC's website overnight. She was referring to the SEC's requirement that compliance professionals certify every year that Credit Suisse is holding to the terms of its plea deal as well as the SEC's sanctions.
Compliance Anxiety
The mandate will «only increase CCO anxiety over heightened personal liability,» she wrote. If the SEC is worried that Credit Suisse isn't making good on its commitment to improve, then the agency should visit the Swiss bank with an examination team instead of singling out the compliance staff themselves, she argued.
Peirce's efforts also aim to shield others parts of Credit Suisse's business from what she called «draconian consequences» of the SEC's action. The agency took $100 million of the total U.S. $475 million financial penalty levied on the Swiss bank.
«No Discernible Purpose»
The SEC exempted other Credit Suisse areas but imposed conditions which Peirce said are unnecessary and in one case «potentially being deleterious». «The commission has decided to condition this needed relief on certifications and reports that serve no discernible purpose,» she wrote.
Credit Suisse, in turn, had little choice but to agree in the interest of burying the wider Mozambique issue in the U.S. It is still on the hook with the Federal Bureau of Investigation, or FBI, with Mozambique itself, and potentially with the International Monetary Fund.
