Facing charges of conspiring to aid tax evasion, Credit Suisse has acknowledged committing the crime rather than risk being shut down completely by U.S. federal regulators.

The bank has admitted to helping thousands of U.S. citizens to avoid paying taxes over a span of decades. With the bank's admission of the crime, it will pay a total fine of $2.5 billion (£1.5 billion). Its admission of guilt is the first by a bank in the U.S. since 1999.

Eric Holder, U.S. attorney general, said that the IRS was cheated by the bank on a grand scale, as the bank helped its account holders to hide vast sums of money overseas in untraceable bank accounts. The tax evasion scam was facilitated by the bank's staff from the managerial position down to its lower-level staff.

Credit Suisse will pay:

  • $1.8 billion fine
  • $670 million in compensation to the IRS
  • $715 million to the Department of Financial Services of the State of New York 
  • $100 million to the U.S. Federal Reserve.

In addition, it will be compelled to hire an independent monitor. The amounts were based upon the conclusion that Credit Suisse had concealed the properties of more than 22,000 customers in the U.S., with properties amounting to about $10 to $12 billion.

Bankers tied to Credit Suisse have been in the hot seat in the past few months. Andreas Bachmann, a former banker at Credit Suisse, admitted to charges of concealing the assets of its U.S. customers, amounting to $4 billion, in March. Bachmann agreed to collaborate with his prosecutors by implicating his superiors and likely contributing to the guilty plea from the bank as a whole. Josef Dorig was also arrested for the same crime in April.

Convicting principal financial institutions of a crime is rare, as it can result in the closure of a company if regulators revoke a business's license to operate. However, anonymous sources cited by the New York Times indicated that the investigators were attempting to avoid this step because they feared a big shock to the economy might result from the bank's closure. If true, it would indicate that, although big banks are not totally above the law, they are being protected from the full consequences of their actions.