Credit Suisse Settles Lawsuit Over Employee Stalking Case in 'Industry's Biggest Scandal'

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Kim Suhwan] Two years after Credit Suisse, a major Swiss bank, caused a scandal by hiring private detectives to spy on a former executive in the so-called 'spy scandal,' the surveilled employee and the bank have reached a settlement, bringing an end to the litigation between the two parties.

According to the Wall Street Journal (WSJ) on the 25th (local time), Iqbal Khan, the plaintiff in the lawsuit surrounding the spy scandal, and Credit Suisse, the defendant, have reached a settlement, and both parties have withdrawn all lawsuits accordingly.

The specific terms of the settlement and the amount of the settlement money have not been disclosed.

However, since Swiss authorities have detected allegations of surveillance activities targeting other executives at Credit Suisse and investigations are underway, the aftermath of the spy scandal is expected to continue.

Previously, in 2019, the scandal escalated when allegations surfaced that Credit Suisse had surveilled Khan, a famous asset management manager of Pakistani immigrant origin at the bank.

Khan was a figure who rapidly rose through the ranks at Credit Suisse and was considered a potential next Chief Executive Officer (CEO).

However, Khan fell out of favor with then-CEO Tidjane Thiam, which hindered his promotion, and he eventually announced in August 2019 that he would join the asset management division of rival firm UBS.

In response, Credit Suisse secretly hired private detectives to monitor Khan.

This was due to concerns that Khan might poach other Credit Suisse personnel to UBS.

Later, Khan discovered the private detectives following him and reported them to the police, and as this incident was reported worldwide, it grew into one of the biggest scandals in the banking industry.

In particular, criticism of Credit Suisse intensified when it was revealed during the police investigation that the person who contracted the private detective agency on behalf of Credit Suisse had taken their own life.

As a result, Chief Operating Officer (COO) Pierre-Olivier Bou?e resigned, and CEO Thiam was ousted by the board's decision.

At the time, foreign media evaluated, "While it is common for banks to try to prevent employee poaching, this spy scandal shook the reputation of Switzerland, which prided itself on professionalism."