While fines for misconduct have fallen from post-financial crisis highs,1the US Department of Justice has said it would step up prosecution of white-collar crime,2and Wall Street banks entered their most recent earnings season under a cloud of rising costs,3much of that associated with increasingly complex governance, risk, and compliance tasks.4
Over the course of the past year, Credit Suisse has generated greater attention to the importance of the human element in connection with governance, risk and compliance. In March 2021, the firm faced a $5.5 billion loss arising from its dealings with Archegos Capital Management. In the same time period as its exposure to Archegos grew, many peer institutions required that Archegos put up more capital to offset what was taken to be an excessively risky and overly concentrated portfolio.With a view to short-term returns, Credit Suisse instead allowed Archegos to take money off the table.5The bank made $17.5 million in fees from its dealings with Archegos in 2020.6
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