Credit Suisse helped US customers hide billions from the Internal Revenue Service, by opening Swiss bank accounts on their behalf, according to a new report from the Senate’s Permanent Subcommittee on Investigations.

Credit Suisse helped US customers hide billions from the Internal Revenue Service by opening Swiss bank accounts on their behalf, according to a new report from the Senate’s Permanent Subcommittee on Investigations.

The report contains the results of a two-year Senate investigation into the bank and claimed that Credit Suisse opened Swiss accounts for over 22,000 US customers with assets that at their peak totaled roughly between $10 billion to $12 billion, the vast majority of which were hidden from US authorities.

According to the investigation, bankers reportedly made 150 trips to the US between 2001 and 2008, who got around US visa rules by visiting the country for tourism rather than business. The bank allegedly opened an office in Zurich airport holding more than 10,000 US accounts so that American clients could access them more easily.

The story comes at a time when more than a third of Swiss banks have reportedly signed up to a US-Swiss accord under which banks state whether they have or have not broken laws concerning US clients. About a dozen banks are currently being investigated. In 2009, UBS, the country's biggest bank, settled criminal and civil charges brought by US authorities, and account details of US clients of the bank have been passed over to Washington. The saga has put the Alpine state's decades-old bank secrecy laws under a harsh spotlight.

Response

In response to the subcommittee report, Credit Suisse said in a statement that it had been "working hard" to clean up its business and improve transparency.

"Credit Suisse acknowledges that misconduct, centered on a small group of Swiss-based private bankers, previously occurred at our bank. While that employee misconduct violated our policies, and was unknown to our executive management, we accept responsibility for and deeply regret these employees' actions," the bank said.

Credit Suisse said that since the subcommittee’s 2008 investigation, it had taken steps to wind down US accounts that were non-tax compliant.

The report was also critical of American law enforcement, which the sub-committee accused of being slow to collect the unpaid taxes and for failing to hold tax evaders and the bank accountable for their actions.

The subcommittee will hold a hearing today (26 February) at which Credit Suisse Group chief executive Brady Dougan is scheduled to testify, along with Robert Shafir and Hans-Ulrich Meister, co-heads of Credit Suisse’s private banking and wealth management unit.

"For too long, international 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 by facilitating US tax evasion," said Senator John McCain, ranking member of the subcommittee.

"As federal regulators begin to crack down on these banks' illicit practices, it is imperative that they use every legal tool at their disposal to hold these banks fully accountable for wilfully deceiving the US government and seek penalties that will deter similar misconduct in the future," he added.

Credit Suisse is one of 14 Swiss banks currently under investigation by US authorities as part of a probe into Swiss lenders for allegedly aiding US clients avoid taxes.

Last Friday, Credit Suisse reached a settlement with the US Securities & Exchange Commission, agreeing to pay a total of $196 million, following the regulator’s probe into unregistered broker-dealer and investment advice services to US clients.