SEC Said to Examine Fund Disclosure Rules
Credit Suisse Group AG’s legal woes are mounting following the collapse of supply chain finance group Greensill Capital, as Zurich prosecutors said they received a complaint related to the matter.
The complaint, filed against “persons unknown,” was received in the middle of this week and is currently being evaluated to see whether a formal probe should be opened, the Zurich Prosecutor’s office said, without identifying who filed the complaint.
The phrase “persons unknown” is typically used in Swiss lawsuits when a plaintiff is seeking damages but doesn’t have specific defendants in mind.
Credit Suisse was sued last week by a small U.S. pension fund that alleged the bank misled investors and let “high-risk clients” including Greensill and Archegos Capital Management take on too much leverage, hurting investors. The fall of Greensill and Archegos have left the bank struggling to contain the fallout, prompted Swiss regulator Finma to investigate what went wrong, and pushed Credit Suisse shares down 20 per cent this year.
Greensill was left struggling to survive in March as investors cut ties over worries about the creditworthiness of its borrowers. Credit Suisse, citing valuation concerns, moved to wind down a US$10 billion group of supply chain finance funds linked to founder Lex Greensill.
News of the lawsuit was reported earlier by Inside Paradeplatz. A spokesman for Credit Suisse declined to comment.