Ex-Credit Suisse banker sentenced in fraud case
A former senior Credit Suisse investment banker was sentenced in New York for hiding some $100 million in losses on sub-prime mortgage bonds in the 2007 US housing market collapse.world Updated: Jun 25, 2014 11:04 IST
A former senior Credit Suisse investment banker was sentenced in New York for hiding some $100 million in losses on sub-prime mortgage bonds in the 2007 US housing market collapse.
David Higgs had already pleaded guilty in 2012 to charges of falsifying the Swiss bank's records, and agreed to cooperate in the probe of several Credit Suisse officials, and so was sentenced to time served, the US Justice Department said on Tuesday.
The British citizen, formerly a managing director in the investment banking division of Credit Suisse Group, was also ordered to pay nearly $1 million in fines and forfeiture of gains.
According to the Justice Department, Higgs and his supervisor Kareem Serageldin sought to hide steep losses on the values of mortgage-backed securities their unit held as the US housing market tanked in 2007.
They marked the bonds for gains on their books, a discrepancy eventually discovered in 2008 by Credit Suisse internal auditors.
The discovery forced the bank to take a $2.65 billion writedown on its portfolio of asset-backed securities in its 2007 accounts.
Serageldin, also a British citizen, was sentenced last November to two and a half years in prison in the case after being extradited from Britain.