(Bloomberg) -- Just before midnight on Sept. 25, former Credit Suisse Group AG executive Colleen Graham e-mailed Chief Executive Officer Tidjane Thiam and Chairman Urs Rohner, detailing how she’d been followed in Manhattan and Long Island by a “striking tall blond” two years earlier.
Graham was heading up a joint venture between Credit Suisse and Palantir Technologies Inc. at the time and had refused to sign off on how revenue from the joint-venture would be booked. The bank took retaliatory measures against her, including the surveillance, according to a complaint she filed in 2017.
So when she heard in September about investigators looking into claims the bank had followed its recently departed head of wealth management Iqbal Khan before he joined UBS Group AG, she reached out to Thiam and Rohner, as well as the law firm the bank hired to investigate, urging them to look into her case too.
But on Oct. 1, the lawyers issued a report saying they had “not identified any evidence that Credit Suisse had ordered observations of other employees.” Chief Operating Officer Pierre-Olivier Bouee had acted alone in ordering Khan be followed, the law firm concluded, prompting Rohner to say that staff surveillance was not “part of our toolbox.”
The episode involving Graham isn’t the only spying incident that didn’t make it into the report. Swiss newspaper NZZ reported on Dec. 16 that Peter Goerke, the bank’s human resources chief, was also tailed for three days in February before leaving the bank’s executive committee later that month.
The events have come back to haunt Thiam just as he seeks to shift the narrative onto Credit Suisse’s performance and away from a scandal that dented the bank’s reputation and cost him a key lieutenant. It has also raised uncomfortable questions about who knew about the covert operations at the bank and who ordered them. Credit Suisse said Friday its own investigation would be completed shortly and results published on Monday.
The preliminary result shows no evidence of Thiam having had knowledge of the surveillance incidents, SonntagsZeitung reported, without saying where it got the information.
The Swiss financial markets regulator -- known as Finma -- is also stepping up its investigation into the bank and appointed an independent auditor to look into the spying allegations, according to a statement late on Friday. The observation activities raise “various compliance issues,” it said.
The law firm, Homburger, referred questions to the bank. A spokesman for Credit Suisse declined to comment on why Graham’s allegations were not mentioned in the report. The bank said it’s “examining the new information,” about Goerke declining to provide further details.
Black Range Rover
In her Sept. 25 email to Thiam and Rohner, which also went to board member John Tiner and was seen by Bloomberg, Graham describes being followed from the “lobby of my lawyer’s office into a pharmacy several blocks away and to the building where I was interviewing” at BlackRock. Graham spotted the same woman, she wrote, in a black Range Rover on Long Island. Her obvious presence indicated “the woman wanted me to know she was following me.”
After hearing nothing following that email, Graham wrote to Homburger. A lawyer responded to a separate message Graham wrote on Sept. 29. In it, he suggested they speak by phone on Sept. 30, a day before the law firm issued its report on the Khan incident.
Graham was a senior compliance executive at Credit Suisse before she was hired to head up Signac, a venture that used Palantir software to detect unauthorized trading by employees. Irritated with her refusal to allow more than $14 million in 2017 revenue to be recognized in 2016, Credit Suisse “expressed strong frustration” about her stance over the accounting problem, Graham alleged in court filings.
U.S. Department of Labor investigators looked at her allegations and dismissed the claims in April, according to the filings in the case. Graham is contesting that decision. Credit Suisse has rejected her allegations as “baseless,” which it says it will continue to fight her claim which also named Palantir.
A hearing scheduled for Dec. 16 in New York was cancelled pending a decision on the firms’ bid to throw out Graham’s case.
In the Goerke case, Credit Suisse probably used a middleman to have him tailed, according to the newspaper. He was watched for three days, an operation that the newspaper reported cost about 12,000 Swiss francs ($12,242).
In the Kahn case, Bouee had communicated with an external surveillance team via an encryped app, Threema. The decision to have the bank’s former star followed would cost Bouee his job when the Homburger report.
(Adds SonntagsZeitung report on CEO in seventh paragraph)
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