NEW YORK (Reuters) – Credit Suisse Group AG CSGN.S agreed to pay $ 15.5 million to settle a lawsuit accusing him of defrauding shareholders over his risk appetite and management before taking $ 1 billion in depreciation on soured debt, according to documents filed by court on Friday.
The preliminary settlement of the class action proposed by the holders of U.S. certificates of deposit of the Swiss bank from March 2015 to February 2016 requires the approval of U.S. District Judge Lorna Schofield in Manhattan Federal Court.
Investors led by four pension and pension plans in New York, Illinois and Alabama claim they lost money after the bank misled them by touting its “global” risk controls and its “restrictive” limits on its exposure to risky and illiquid debt.
Credit Suisse wrote twice in early 2016 on $ 4.3 billion in guaranteed loan bonds and distressed debt, contributing to its first full-year loss since the 2008 global financial crisis.
The bank denied any wrongdoing and argued that it had no intention of defrauding. Credit Suisse said it was happy to reach a settlement resolving all claims, including claims against former CEOs Brady Dougan and Tidjane Thiam.
Reporting by Jonathan Stempel in New York; Editing by Richard Chang and David Gregorio