By Adria Calatayud

UBS Group agreed to pay $511 million to settle a yearslong U.S. probe into violations by Credit Suisse of an earlier agreement with the Justice Department over American clients who evaded taxes.

The Swiss bank, which acquired Credit Suisse in 2023, and the Justice Department said Monday that Credit Suisse Services AG pleaded guilty to tax crimes and entered into a separate nonprosecution agreement related to conduct in Singapore on behalf of U.S. taxpayers.

The Wall Street Journal reported in January that UBS was set to pay at least hundreds of millions of dollars to settle the Credit Suisse tax case.

UBS has sought to address the legacy issues it inherited as part of the rescue takeover of its former cross-town rival. At the time of the acquisition, it set aside billions of dollars in provisions to cover potential probes and legal battles in which Credit Suisse was involved.

The bank said it expects its group second-quarter results to book a partial release of the provision it established with the acquisition of Credit Suisse. However, its operating parent bank, UBS AG, expects to record a charge in relation to the settlement.

Credit Suisse pleaded guilty in 2014 to conspiring to help thousands of Americans cheat on their taxes. It paid $2.6 billion to U.S. authorities and entered a plea agreement requiring it to root out and shut any remaining undeclared American-held accounts.

The Justice Department said Credit Suisse helped U.S. customers in concealing their ownership and control of assets and funds held at the bank between January 2010 and July 2021 and enabled them to evade U.S. tax obligations, breaching its 2014 plea agreement with the U.S.

Moreover, the Justice Department said UBS became aware in 2023--after the takeover--of accounts held at Credit Suisse's Singapore branch that appeared to be undeclared U.S. accounts, reported them to U.S. authorities, and cooperated by conducting an investigation. Credit Suisse failed to adequately identify the true beneficial owners of the accounts, held between 2014 and June 2023, the Justice Department said.

UBS said it will pay $371.9 million for Credit Suisse's role in aiding and assisting in the preparation of false income tax returns and $138.7 million as part of the agreement regarding U.S. taxpayers booked in the legacy Credit Suisse Singapore booking center.

The bank said it wasn't involved in the conduct, which began before UBS acquired Credit Suisse.

Write to Adria Calatayud at adria.calatayud@wsj.com

(END) Dow Jones Newswires

May 06, 2025 03:00 ET (07:00 GMT)

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