(Benzinga) -
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Credit Suisse Group (NYSE: CS) battled a $600 million penalty over its mishandling of a former star banker turned fraudster.
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Lawyers for Credit Suisse Life (Bermuda) Ltd, the life insurance unit held responsible for the mistakes, will likely challenge its ability to pay the money when the appeal trial begins on Monday, Bloomberg reports.
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A Bermuda judge awarded the damages to bank client and Georgian billionaire Bidzina Ivanishvili in March after ruling that Credit Suisse Life had turned a “blind eye” to convicted fraudster Patrice Lescaudron’s misuse of Ivanishvili’s money.
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The bank said the Frenchman, convicted in 2018, was a lone wolf who hid his criminal activity from colleagues and supervisors.
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Judge Narinder Hargun ruled that the bank unit bore responsibility because “CS Life knew about certain of Mr. Lescaudron’s wrongdoing and could and should have known about his further wrongdoing.”
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Ivanishvili has also gone after the Swiss lender in Singapore over what the Georgian claims are $800 million in losses.
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Credit Suisse Trust (Singapore) Ltd admitted during a trial that it failed to inform its billionaire client about unauthorized transfers from his accounts.
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Credit Suisse was hit with a criminal conviction for failing to prevent money laundering in June and tens of billions in outflows of client money.
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Price Action: CS shares traded higher by 2.96% at $3.48 in the premarket on the last check Monday.
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By Anusuya Lahiri
