UBS Faces New Scandal Over Nazi-Linked Credit Suisse Accounts

UBS has had a rough couple of years from posting major losses in 2023 - 2024 related to the Credit Suisse integration as well as the bank's "bad bank" unit, containing unwanted Credit Suisse assets, now expected to generate losses of around $1 billion through 2026.

Now, to throw likely an even bigger wrench into their comeback plans, a recent U.S. Senate investigation has found extensive evidence of previously undisclosed Nazi-linked accounts at Credit Suisse, now owned by UBS. 

The findings reveal that Credit Suisse maintained accounts tied to Nazi activities, many of which were concealed during earlier inquiries, including those conducted in the 1990s...

According to reports, 3,600 physical documents and 40,000 microfilms were found with high relevance to Nazi connections, with multiple client files marked "Amerikanische schwarze Liste" (American Black List), indicating direct financial ties to Axis powers. The probe identified hundreds of Nazi intermediaries who helped hide Nazi gold, camouflaged illicit transactions for war materials, participated in looting Jewish assets, and supported the overall Nazi war economy during WW2.

UBS has engaged Neil Barofsky, a former U.S. prosecutor, as an independent ombudsman to lead the investigation. The bank has committed to providing a complete accounting of Nazi-linked legacy accounts, with a final report expected by early 2026. The Senate Budget Committee investigation is led by Chairman Sheldon Whitehouse (D-R.I.) and Ranking Member Chuck Grassley (R-Iowa).

Following the news, UBS's stock was dumped, as investors were concerned about potential reputational damage. The implications of these revelations are likely to get worse rather than better.

A UBS spokesperson stated, "UBS is committed to contributing to a fulsome accounting of Nazi-linked legacy accounts previously held at predecessor banks of Credit Suisse."

UBS currently manages the largest private wealth worldwide, with about CHF 3.2 trillion in assets. Following the Credit Suisse acquisition, this grew to over $5 trillion. UBS aims to maintain $5 trillion AUM by 2028.