Two Credit Suisse Ex-Employees Plead Guilty in Bond Probe
NEW YORK—Two former Credit Suisse Group AG employees pleaded guilty Wednesday to criminal charges over alleged misstatements regarding the bank's mortgage-bond valuations during the financial crisis.
David Higgs, a U.K. citizen, pleaded guilty to conspiracy to falsify books and records and to commit wire fraud at a hearing before U.S. District Judge Alison J. Nathan in Manhattan federal court on Wednesday. Mr. Higgs, who is cooperating with prosecutors, faces up to five years in prison on the charge.
About an hour later at a separate hearing in the downtown Manhattan federal courthouse, Salmaan Siddiqui, a former Credit Suisse trader who reported to Mr. Higgs, pleaded guilty to conspiracy to falsify books and records. Mr. Siddiqui also is cooperating in the investigation.
The long-running investigation is expected to result in charges against fewer than half a dozen former Credit Suisse traders, according to people familiar with the matter.
The Manhattan U.S. Attorney's office is planning to allege in a criminal complaint as early as today that several former traders at the global investment bank misled its investors by booking inflated prices of mortgage bonds to boost their bonuses, despite knowing the values of those securities had dropped, The Wall Street Journal reported Tuesday night, citing people familiar with the matter.
The Securities and Exchange Commission is planning to file related civil charges, the people said.
Credit Suisse itself won't be charged in the case, the people said. A spokeswoman for Credit Suisse declined to comment Wednesday. READ MORE...
| Posted by CHAD BRAY, MICHAEL ROTHFELD and JENNY STRASBURG on Feb 1, 2012 | ||
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