Credit Suisse sued in U.S. over alleged business related to oligarchs

– A group of people and entities have filed a class action lawsuit against Credit Suisse, alleging that the Swiss bank misled investors over business dealings related to Russian oligarchs, law firm Pomerantz LLP said.

Credit Suisse did not comment when contacted by Reuters.

The lawsuit, filed in a New York district court, is on behalf of people and entities who acquired Credit Suisse securities between March 19, 2021 and March 25, 2022, Pomerantz said in a statement issued late on Friday.

“The complaint alleges that, throughout the class period, defendants made materially false and misleading statements regarding the company’s business, operations, and compliance policies,” Pomerantz said in the statement.

The law firm alleged disclosure shortcomings around a securitisation deal. It cited in its statement a Financial Times story from February in which the newspaper reported that Credit Suisse had securitised a portfolio of loans linked to its wealthiest customers’ yachts and private jets, in an unusual use of derivatives to offload the risks associated with lending to ultra-rich oligarchs and entrepreneurs.

The Financial Times said that after the publication of its article, Credit Suisse said in a statement that the transaction “priced in line with other significant risk transactions, offered competitive investment and hedging terms for our professional investor clients while increasing the capital flexibility of the bank.”

The lawsuit also referred to a request made by U.S. lawmakers in March for Credit Suisse to hand over documents related to the financing of yachts and private jets owned by potentially sanctioned individuals.

On March 3, Credit Suisse said no client data had been erased within the bank when it asked investors to destroy documents relating to a transaction last November, reacting to a further Financial Times report related to oligarchs.

Credit Suisse stopped pursuing new business in Russia after the invasion of Ukraine on Feb. 24, the Swiss bank said on March 28 in an internal document seen by Reuters.

Credit Suisse, which reported a first-quarter loss this week, has been dented by a series of costly hits and a series of legal cases that it has described as legacy matters.