UBS not blameless in CS-Bulgaria connection case

That would have been too easy. With the end of Credit Suisse, UBS also hoped to bury the lawsuit surrounding the so-called “Bulgaria Connection”. However, the court still sees the remaining large bank as liable.

The June 2022 verdict against Credit Suisse (CS) by the Federal Criminal Court in Bellinzona was a minor sensation. The bank was fined 2 million Swiss francs ($2.4 million) for failings in dealing with client relationships with a criminal organization and for failing to properly implement anti-money laundering regulations.

The bank’s appeal was likely an unwelcome legacy for UBS. The bank argued that the dissolution of CS should also end the criminal proceedings against the bank and requested that the case be dismissed.

UBS inherits CS position in legal proceedings

However, the judges in Bellinzona did not agree with this position, the Swiss news agency SDA reported. In their ruling, published on Tuesday, they referred to the merger agreement between the two large banks. This agreement includes not only the transfer of capital, buildings and staff, but also the assumption of CS’s position in all judicial, arbitration and administrative proceedings.

The ruling is not yet final and UBS has the option to appeal to the Federal Supreme Court.

The huge trial involves links between a former CS employee, the Bulgarian mafia, drug trafficking and money laundering. Both CS as a company and a former employee were found guilty. In addition, the court ordered the seizure of assets worth more than CHF 12 million and imposed a substitute claim on CS for more than CHF 19 million for funds that could not be seized.