Could another Credit Suisse “Spygate” happen today?
I was recently asked to contribute to an article in The Banker examining a critical question raised by the Credit Suisse surveillance scandal: could such conduct happen again?
In 2019 it emerged that private investigators had been engaged to follow a senior Credit Suisse wealth management executive amid fears that he might take clients to a rival institution. The episode ended with an extraordinary pursuit through the streets of Zurich culminating in an altercation near the Swiss National Bank.
This incident was not isolated. FINMA, the Swiss financial regulator, found that Credit Suisse had planned seven surveillance operations between 2016 and 2019 most of which were carried out. What appeared almost cinematic was in reality evidence of serious internal organisational and governance failures.
As I observed in The Banker article, covert unauthorised surveillance can undoubtedly occur again when personal tensions or commercial rivalries override sound judgement. I would, however, be surprised if it remained an organised practice at any major bank given the likely severe regulatory and reputational consequences.
Pressures can become particularly acute at senior levels. Large revenues and valuable client relationships raise the commercial stakes while powerful egos can always distort judgement. Neither can ever justify disproportionate conduct. The greater the sums involved, the stronger the governance and approval procedures must be.
Ultimately the lesson from Credit Suisse was not simply about surveillance but rather the fact that independent governance and legal review failed when they were most needed.
Reputation is a core banking asset. Once institutional trust is lost, it may never be fully recovered.
