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UK Regulator Puts Scandal-Plagued Credit Suisse Under the Microscope

 |  June 13, 2022

The UK Financial Conduct Authority has put Credit Suisse on a watchlist of companies needing tougher supervisions, a Financial Times (FT) report says.

According to the FCA, Credit Suisse may not have done enough to “improve its culture, governance and risk controls.” Regulators reportedly thought the bank needed to provide evidence of what it would do to prevent misconduct and improve accountability, along with addressing what it said were “persistent” cultural issues like a lack of internal challenges for risky transactions.

Credit Suisse has reportedly had numerous scandals in the last two years, which the report says have exposed weak risk controls and forced the bank to issue several profit warnings, damaging its share price.

Among the scandals was the way Greensill Capital imploded in March of 2021. That incident caused Credit Suisse to shut down $10 billion in funds related to the supply chain group. And only weeks after, the company lost $5.5 billion in the biggest trading loss in its history.

The FCA signals the seriousness of the situation with this designation, as the watchlist only scrutinizes around 20 or so institutions.

Groups on the list are closely watched by high officials with the FCA, and have to show progress by addressing the root causes of concern.

PYMNTS wrote that Credit Suisse in February was trying to curb the fallout in the wake of revelations that there had been 18,000 leaked accounts connected to criminals, alleged human rights abusers and sanctioned people including dictators.