CEO cleared amid Swiss bank's spying and suicide scandal
Credit Suisse cleared its CEO yesterday of snooping on a star wealth manager in an episode that saw suicide, scandal and espionage invade the secretive world of Swiss private banking.
The spying on ex-wealth management chief Iqbal Khan after he left the bank for arch-rival UBS, and the suicide of a private investigator involved in organising the surveillance, has badly tarnished the reputation of the Swiss bank and its top managers.
"I've not come across anyone who is not shocked by what is happening," a person familiar with Credit Suisse's management said.
"The shock is big. What you've seen in the media over the last 10 days has had a massive impact on the staff here," they added.
Mr Khan, who left Switzerland's second-biggest bank in July and began work yesterday at UBS, was under surveillance by private detectives hired by Credit Suisse from September 4 to 17, when he spotted them.
News of a rift between Credit Suisse CEO Tidjane Thiam and Mr Khan prior to the latter's departure has prompted speculation over the reasons for the surveillance, which has roiled Switzerland's financial centre, triggered a criminal investigation and hurt the image of everyone involved.
A private investigator who organised the surveillance of a senior former Credit Suisse manager committed suicide last week, a lawyer for the security firm at the centre of the spying case said.
The bank's chairman, Urs Rohner, said yesterday that a personal dispute between Mr Khan and Mr Thiam, which had made it impossible for the two of them to work together, had prompted Mr Khan's departure but had been unrelated to the hiring of detectives.
The bank's internal probe carried out by law firm Homburger found Chief Operating Officer Pierre-Olivier Bouee alone initiated observation of the former wealth management executive to see if he was trying to poach former colleagues to join him at UBS.
The investigation found no evidence that Mr Khan had attempted to poach employees or clients from Credit Suisse.
Mr Bouee - whose professional life has closely tracked Mr Thiam's, having worked together at McKinsey, Aviva and Prudential before moving in 2015 to Credit Suisse - stepped down from his role to take responsibility for the matter, the bank said yesterday.
Mr Bouee and Mr Thiam had been close associates since the McKinsey days, with Mr Bouee described as more abrasive than Mr Thiam by one source who previously worked with them both in Britain.
"He was bad cop to Tidjane's good cop," the person said, adding that the two usually spoke together in French.
A second banker who worked with both added that, while Mr Thiam and Mr Bouee had a good working relationship, Mr Thiam did not maintain an inner circle of closer contacts amongst his team.
Mr Rohner told a news conference yesterday that Mr Thiam still enjoyed the full confidence of the board.
"We have absolutely zero evidence that he was informed about it," he said, while apologising to Mr Khan and his family for the incident.
The board called the spying operation "wrong and disproportionate" in a statement, adding it had caused severe reputational damage for the bank.
The criminal investigation of the spying operation continues.
Mr Rohner and John Tiner, head of the board's audit committee, batted back questions about the credibility of the probe's findings, saying the incident was unusual and insisting Mr Thiam was on top of what was happening at the group.