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To: pater tenebrarum who wrote (53850)	7/29/1999 11:02:00 PM
From: John Pitera	Respond to of 86076

Heinz, here is an earlier story on CSFB and the Japanese Sanctions. July 14, 1999 -------------------------------------------------------------------------------- Japan Could Revoke Credit Suisse License By JATHON SAPSFORD Staff Reporter of THE WALL STREET JOURNAL TOKYO -- Credit Suisse Group has until the end of the week to appeal a recommendation by Japan's Financial Supervisory Agency that a banking license at one of the Swiss concern's units here be revoked and operations at several other units possibly suspended, according to people familiar with the proceedings. The FSA said it informed Credit Suisse that the agency determined -- after an unusually long investigation of several months -- the Swiss-based company illegally had obstructed authorities seeking to conduct a routine examination, these people said. The agency also said Credit Suisse, the parent company of investment bank Credit Suisse First Boston, was involved in a variety of other trades that were "inappropriate" and counter to the public interest. Credit Suisse management was summoned by Japan's top financial regulatory body, the Financial Reconstruction Commission, late Tuesday and told that the FSA has recommended that the Japanese banking license of its Credit Suisse Financial Products unit be revoked, according to people close to the proceedings, who spoke only on the condition they not be named. The FSA also has recommended that other, unnamed units temporarily stop operations. Credit Suisse runs a trust bank, an asset-management company and a securities brokerage in Tokyo -- operations that employ more than 700 people in total. The Financial Reconstruction Commission will make a final decision on the recommendations by the end of the week. Credit Suisse has the right to appeal the charges, but it wasn't immediately clear how far the bank would proceed. Other foreign financial institutions have been watching the Credit Suisse case for signs of how the FSA, which was established in June 1998, will regulate financial institutions amid a new, more-competitive era in Japan's finance sector. The FSA has said its monitoring function of both domestic and foreign institutions would be stepped up to ensure the success of Japan's broad financial-reform program. Credit Suisse doesn't dispute the most serious charge that its employees obstructed examiners. The group stresses that it hired an outside law firm to conduct its own probe into the affair, and concedes that its staff had shredded files and deleted electronic messages that might have been of interest to regulators. Credit Suisse believes, however, that it should be treated with at least some leniency for having flushed out the extent of the problem, dismissed responsible staff members and disclosed unflattering details to regulators and the public. "We discovered that. We brought it to their attention," Credit Suisse spokesman Tom Grimmer said. Senior officials at the Swiss banking concern may also dispute the allegations of inappropriate behavior. Like a number of other foreign financial companies in Tokyo, Credit Suisse has marketed products that Japanese clients, largely banks and insurers, often used to conceal troubled assets. But these products complied with Japanese law, and the FSA's report falls short of accusing Credit Suisse of illegal behavior. --------------------------------------------------------------------------------