ZURICH (Reuters) – Credit Suisse cleared CEO Tidjane Thiam of ordering a surveillance of former wealth administration head Iqbal Khan, however stated his right-hand man has resigned over the botched spying case that severely broken the financial institution’s status.
FILE PHOTO: Swiss financial institution Credit Suisse CEO Tidjane Thiam waits for a information convention after the Swiss Global Digital Summit in Geneva, Switzerland, September 2, 2019. REUTERS/Denis Balibouse/File Photo
Khan, who left Switzerland’s second-biggest financial institution in July and started work on Tuesday at arch-rival UBS, was underneath surveillance by personal detectives employed by Credit Suisse from Sept. Four to Sept. 17, when he noticed them.
An inner Credit Suisse investigation carried out by legislation agency Homburger discovered Chief Operating Officer Pierre-Olivier Bouee alone initiated commentary of Khan to see if he was making an attempt to poach former colleagues to hitch him at UBS, the financial institution stated on Tuesday.
Bouee – whose skilled life has intently tracked Thiam’s, having labored collectively at McKinsey, Aviva and Prudential earlier than transferring in 2015 to Credit Suisse – stepped down from his position to take duty for the matter, it added.
Credit Suisse Chairman Urs Rohner stated that Khan left the financial institution after a private dispute with Thiam which made it unattainable for the 2 to work collectively.
Rohner advised a information convention Thiam nonetheless loved the total confidence of the board. “We have absolutely zero evidence that he was informed about it,” he stated, whereas apologizing to Khan and his household for the incident.
Generating sensational headlines about private enmity between Thiam and Khan within the usually dispassionate world of Swiss personal banking, the scandal has additionally triggered a legal investigation and damage the picture of everybody concerned.
A non-public investigator who helped the financial institution manage the surveillance dedicated suicide final week, a lawyer for the safety agency on the middle of the case stated.
The legal investigation of the spying operation continues.
“The Board of Directors considers that the mandate for the observation of Iqbal Khan was wrong and disproportionate and has resulted in severe reputational damage to the bank,” the Credit Suisse board stated in an announcement.
Rohner and John Tiner, head of the board’s audit committee, batted again questions concerning the credibility of the probe’s findings, saying the incident was uncommon and insisting Thiam was on prime of what was taking place on the group.
Only two staff – Bouee and the safety boss underneath him, who additionally resigned – knew of the surveillance, the probe discovered.
However, deleted messages despatched on safe platform Threema utilized by Bouee and safety personnel had restricted the scope of the findings, Homburger managing companion Flavio Romerio stated.
Messages between Bouee and Thiam from Aug. 22 onward, which had been despatched by way of firm e mail and messaging platform WhatsApp, had been reviewed and located to not be related, he added.
Thiam didn’t attend the information convention.
Two large shareholders have stated they needed Thiam, architect of a sweeping three-year revamp on the financial institution, to remain until it was proven he broke the legislation.
Credit Suisse’s shares reversed early positive factors on Tuesday to fall 1.1% by noon.
The investigation discovered no proof that Khan had tried to poach staff or purchasers from Credit Suisse. Nor did it reveal any proof that the surveillance was associated to private variations between Khan and Thiam as reported by media, a abstract stated.
Khan was identified as the graceful and impressive supervisor placing life into Thiam’s technique of reshaping the financial institution right into a wealth administration juggernaut to rival greater peer UBS.
Under his watch, the International Wealth Management enterprise he led greater than doubled income and sharply boosted the consumer belongings it handles.
The abrupt departure of Pakistan-born Khan, who moved to Switzerland when he was 12, uncovered his falling out with Thiam, the 57-year-old Franco-Ivorian govt who revamped a stagnant Credit Suisse by chopping 1000’s of jobs, scaling again funding banking and bolstering its stability sheet.
Rohner stated a heated alternate that came about between the 2 in January prompted the chairman to get entangled.
“The decisive question for me was whether the differences between the two gentlemen… would impact their cooperation going forward,” Rohner stated, including their efficiency was unaffected at first. “But it became apparent that a long-term, trusting and mutual cooperation was no longer possible and that Mr. Khan wanted to leave the bank.”
Khan’s swap to co-head of wealth administration at market chief UBS sealed the divorce.
Khan, 43, went to the police after the Sept. 17 confrontation with at the least one detective who was shadowing him and his spouse as they drove by means of Zurich. Conflicting variations have emerged of how the incident unfolded.
A spokesman for Khan didn’t reply to a request for remark, whereas UBS declined remark.
Credit Suisse named firm veteran James Walker as COO to exchange Bouee.
Reporting by Brenna Hughes Negaiwhi and Michael Shields; Additional reporting by Silke Koltrowitz; Editing by John O’Donnell/Edwina Gibbs/Susan Fenton