Brenna Hughes Neghaiwi, Silke Koltrowitz

ZURICH (Reuters). Credit Suisse On Monday, (SIX) was charged in Switzerland with allowing a gang that trafficked cocaine from Bulgaria to laundering millions of euro. Some of the money was stuffed into suitcases.

Swiss authorities claim that the second-largest bank in the country and one its former managers failed to take the necessary measures to stop the drug dealers from laundering money between 2004 and 2008.

Credit Suisse said that it rejects all claims in the legacy case against it as untrue and was convinced its ex-employee is innocent.

The first criminal case against a Swiss bank major is underway. Credit Suisse has been asked to pay around 42.4 millions Swiss Francs as compensation.

In Switzerland, the case is attracting intense attention because it’s seen as a challenge to prosecutors who may take a tougher stand against banks in the country.

It covers more than 500 pages and focuses on the relationship Credit Suisse’s ex-employe had with Evelin Bnev (former Bulgarian wrestler) and many associates. Only two are facing charges in this case. The second case indictment charges the former Julius Baer relationship manager with money laundering.

According to Swiss privacy laws the legal representative of the former Credit Suisse employee could not identify his client, he said the case wasn’t justified and that his client did nothing wrong.

The two accused gang members are facing multiple charges in Swiss Federal Court of Fraud, Misappropriation and Forgery. However, they cannot be identified under Swiss Privacy Laws. A lawyer representing them declined to comment. An attorney representing Julius Baer’s former relationship manager did not reply to inquiries for comment.

Banev does not face any charges in Switzerland. In 2017, Banev was convicted for drug trafficking in Italy, and in Bulgaria, in 2018. He also was found guilty of participating in a criminal organization involved in the trafficking of tonnes of cocaine from Latin America.

His disappearance was not confirmed, however, he was detained in Ukraine in September. He is now being tried for drug trafficking as well as setting up an illegal criminal organization.

Banev’s legal representative and Banev could not be reached to comment. Banev was represented by a lawyer at his trial in Bulgaria. She said she would no longer be representing him.

Julius Baer declined to discuss the case, as he is not being charged.

CASH IN CAUSES

According to the indictment, she brought with her at least one former Credit Suisse employee who had been an associate of Banev when she joined Credit Suisse back in 2004.

According to the indictment, the customer was shot and killed as he left a Sofia restaurant in 2005 with his wife. He had started placing cash-filled suitcases in safe deposit boxes at Credit Suisse.

The gang is accused of using so-called “smurfing”, where large amounts of money are broken down into smaller amounts that fall below the threshold for anti-money laundering. This was done to help launder money. They placed millions of euro in small-value bills and then transferred them into accounts.

Even though Swiss banks are now more strict in anti-money laundering, so-called Know-Your-Client checks have been implemented by international pressure. However the defendants stated that this was common practice when the deposit was made.

According to the prosecutors, the former relationship manager of Credit Suisse, was detained by police for two weeks in 2009. He then left Credit Suisse in 2010.

According to attorneys representing the former employee at MANGEAT LLC, “our client is unfairly accused because Swiss law requires that a persons be implicated before a bank can be condemned,” Reuters was informed by MANGEAT LLC. The accusations are a travesty. “We will appeal for her complete and unconditional acquittal.”

Credit Suisse denies the illicit origin of the money. According to Reuters, a source with the bank’s thinking, Banev and his friends owned legitimate hotels, construction and leasing businesses.

According to the indictment, the Swiss bank considered Bulgaria to be a high-risk nation at that time. The source said the Swiss bank plans to raise awareness to Swiss prosecutors about calls it made to its compliance unit following Banev’s arrest in Bulgaria, April 2007.

Credit Suisse believes that the court will consider that Credit Suisse’s compliance division’s decision was evidence that they are taking their anti-money laundering obligations seriously. They also hope that this is a signal that they have cooperated with prosecutors.

The source said that the Bulgarian authorities requested information from Credit Suisse in June 2007 about accounts owned by Banev and associates.

The bank’s compliance team noticed a string of withdrawals and asked the prosecutors if they would like to lock the accounts. However, they were not told to, as it was not a tip-off to clients, said the source.

Credit Suisse had already withdrawn large amounts of money by the time the prosecutors approved their request.

According to the prosecutor’s office, Friday was not a good day for comment as the matter was still in court.

A second federal indictment was filed against Julius Baer’s ex-relationship manager. The case is still being prosecuted in the same court. Some of the money was allegedly transferred to another Swiss bank.

A former relationship manager who left just a few short months after the transfer took place is being charged with facilitating money laundering.

According to the indictment, the bank refused to take a bag containing cash belonging the defendants.