Credit Suisse executive quits after snooping on ex-manager

 Swiss bank Credit Suisse said Tuesday that a senior executive and the head of its security operation have resigned over a decision to snoop on a former wealth management chief who joined rival UBS.

Credit Suisse said chief operating officer Pierre-Olivier Bouee "assumed responsibility for this matter" and that the bank accepted his immediate resignation. Its head of global security services is also leaving immediately.

The bank said Bouee ordered the security chief to "initiate the observation" of former Credit Suisse wealth management chief Iqbal Khan on August 29, when UBS announced Khan's appointment. Bouee says he decided alone to keep tabs on Khan "in order to protect the interests of the bank" and didn't discuss the matter with CEO Tidjane Thiam or other top managers.

Chairman Urs Rohner says there was "zero evidence" that Thiam had been informed about the snooping. Bank officials said Bouee had been concerned that Khan might try to poach employees from Credit Suisse to join him at UBS, and "the fact that Iqbal Khan continued to socialize with key employees of Credit Suisse had contributed to the COO's concerns," Credit Suisse said.

Credit Suisse said it ultimately turned up no indications that Khan had tried to poach employees or clients.

The "extraordinary" and "irregular" episode – as top executives put it – testifies to the intense rivalry between UBS and Credit Suisse, whose key offices co-habit the Paradeplatz square in downtown Zurich that is the heart of Switzerland's vibrant and well-heeled financial sector.

"It's not, obviously, the standard way as to how we conduct our business," Rohner told reporters in Zurich. Credit Suisse officials acknowledged that some encrypted chat messages were deleted, and Credit Suisse's hired legal experts did not have access to police files.

The snooping came to a head when Khan "spotted and confronted one of his tails" in downtown Zurich on September 17, the culmination of nearly two weeks of on-and-off tracking.

Swiss media reported that Khan, noticing that he had been trailed while on a shopping excursion, emerged from his car and started to take photos of the license plate of the private investigator's vehicle. The investigator then insisted that Khan stop doing that, told Khan to hand over his phone, at which point Khan started to shout out for police help – and the investigator left.

Swiss news reports also said Khan's exit from Credit Suisse followed a cocktail party at Thiam's home – the two men are next-door neighbors in a posh lakeside town near Zurich – in January at which the two men, previously known to be personal friends, had an argument.

Credit Suisse said it did not investigate the events at that party.