Noor Zainab Hassain

(Reuters) – U.S. Democratic Senators Elizabeth Warren, Tina Smith and Tina Smith asked the Department of Labor for a denial of Swiss lender Credit Suisse According to a letter Reuters received on Friday, (SIX) Group AG obtained a regulatory exemption in relation to the management of its retirement funds following a Justice Department settlement regarding bribery.

Warren is one of the Senate’s most powerful lawmakers. His letter will intensify scrutiny of the Swiss bank which is currently undergoing restructuring after a series of scandals.

Sen. Ali Khawar, Acting Assistant Secretary at the Employee Benefits Security Administration, in the Department of Labor was sent the letter Thursday. The Senators expressed concerns over ESBA’s plan to exempt Credit Suisse from a QPAM (qualified professional asset manager) for a year.

As a QPAM bank, it is currently able to administer or transact client’s 401(k), and pension plans. The EBSA rules prohibit financial entities from retaining QPAM status if they are convicted of trust management-related criminal activity.

Credit Suisse could continue to do business as usual with this waiver.

Credit Suisse and EBSA didn’t immediately reply to our requests for comment.

If companies agree to settle misconduct charges, it has been an accepted practice by regulators to allow them to waive business restrictions. Democrats claim that the practice allows businesses to continue to commit misconduct with minimal consequences.

Senators wrote, “We ask you to reconsider this proposal. It would undermine efforts to hold Credit Suisse responsible for its illegal behaviour.”

It cited a October 2021 international resolution by the bank for embezzling U.S. and foreign investors as well as a 2014 conviction to support the denial of the exemption.

Credit Suisse’s European subsidiary has pleaded guilty for defrauding investors regarding an $850m loan to Mozambique to finance a tuna-fishing fleet. It is now paying $475 million to U.S. regulators to resolve the matter under a deal that was announced in October.

Credit Suisse has multiple problems.

After U.S. family officer Archegos Capital Management went bankrupt in March, it lost $5.5 Billion. It was also forced to stop $10 Billion in supply chain finance funds when Greensill Capital failed in March.

Following an investigation into his conduct, Chairman Antonio Horta Osorio abruptly resigned last month.