Federal Register / Vol. 87, No. 75 / Tuesday, April 19, 2022 / Notices 23249 

law of its domiciliary State of Vermont) 

by the Insurance Commissioner of 

Vermont within five years before the 

end of the year preceding the year in 

which the reinsurance transaction 

occurred; 

(5) Have undergone, and continue to 

undergo, an examination by an 

independent certified public accountant 

for its last completed taxable year 

immediately before the taxable year of 

the Reinsurance Arrangement covered 

by this exemption; and 

(6) Be licensed to conduct reinsurance 

transactions by a state whose law 

requires that an actuarial review of 

reserves be conducted annually by an 

independent firm of actuaries and 

reported to the appropriate regulatory 

authority; 

(g) In each year of coverage provided 

by a Fronting Insurer, the formulae used 

by the Fronting Insurer to calculate 

premiums will be similar to formulae 

used by other insurers providing 

comparable life insurance coverage 

under similar programs. Furthermore, 

the premium charges calculated in 

accordance with the formulae will be 

reasonable and comparable to the 

premiums charged by the Fronting 

Insurer and its competitors with the 

same or a better financial strength rating 

providing the same coverage under 

comparable programs; 

(h) The Plan must pay no 

commissions with respect to the sale of 

such contracts or the Reinsurance 

Arrangement; 

(i) The Fronting Insurer must have a 

financial strength rating of ‘‘A’’ or better 

from A.M. Best Company (A.M. Best) or 

an equivalent rating from another rating 

agency; 

(j) The Reinsurance Arrangement 

between Spirit and Zurich or any 

successor Fronting Insurer must be 

indemnity insurance only. The 

arrangement must not relieve a Fronting 

Insurer from any responsibility or 

liability to the Plan, including liability 

that would result if Spirit fails to meet 

any of its contractual obligations to 

Zurich or any successor Fronting 

Insurer under the Reinsurance 

Arrangement; 

(k) Phillips 66 will not offset or 

reduce any benefits provided to Plan 

participants and beneficiaries in relation 

to its implementation of the Benefit 

Enhancements; 

(l) The Independent Fiduciary must: 

(1) In compliance with the fiduciary 

obligations of prudence and loyalty 

under ERISA Sections 404(a)(1)(A) and 

(B) (i) review the Reinsurance 

Arrangement and the terms of the 

exemption; (ii) obtain and review all 

current objective, reliable, third-party 

documentation necessary to make the 

determinations required of the 

Independent Fiduciary by the 

exemption; and (iii) confirm in writing 

that all of the exemption’s terms and 

conditions have been met (or, due to 

timing requirements, can reasonably be 

expected to be met consistent with the 

terms of this proposed exemption) and 

send this confirmation to the 

Department’s Office of Exemption 

Determinations at least 30 days before 

Phillips 66 engages in the Reinsurance 

Arrangement. The confirmation must 

include copies of each document relied 

on by the Independent Fiduciary and 

the steps the Independent Fiduciary 

took to make its confirmation; 

(2) Monitor, enforce and ensure 

compliance with all conditions of this 

exemption, in accordance with its 

obligations of prudence and loyalty 

under ERISA Sections 404(a)(1)(A) and 

(B), including all conditions and 

obligations imposed on any party 

dealing with the Plan, throughout the 

period during which Spirit’s assets are 

directly or indirectly used in connection 

with a transaction covered by this 

exemption. 

(3) Report any instance of noncompliance immediately to the 

Department’s Office of Exemption 

Determinations; 

(4) Take all appropriate actions to 

safeguard the interests of the Plan; 

(5) Review all contracts pertaining to 

the Reinsurance Arrangement, and any 

renewals of such contracts, to determine 

whether the requirements of this 

exemption and the terms of Benefit 

Enhancements continue to be satisfied; 

(6) Submit an annual Independent 

Fiduciary Report to the Department 

certifying under penalty of perjury 

whether each term and condition of the 

exemption is met over the applicable 

period. Each report must be: (i) 

Completed within six months after the 

end of the twelve-month period to 

which it relates (the first twelve-month 

period begins on the effective date of the 

exemption grant); and (ii) submitted to 

the Department within 60 days 

thereafter. The relevant report must 

include all of the objective data 

necessary to demonstrate that the 

Primary Benefit Test has been met; 

(m) Neither Phillips 66 nor any 

related entity may use participantrelated data or information generated by 

or derived from the Reinsurance 

Arrangement in a manner that benefits 

Phillips 66 or a related entity. 

Notwithstanding the above, this 

condition does not preclude Phillips 66 

from using participant-related data 

solely to improve the administration of 

the Plan or to enhance the Plan’s 

benefits; 

(n) No amount of Spirit’s reserves that 

are attributable to the Plan participants’ 

contributions may be transferred to 

Phillips 66 or a related party; 

(o) All the facts and representations 

set forth in the Summary of Facts and 

Representation must be true and 

accurate; and 

(p) No party related to this exemption 

request has or will, indemnify the 

Independent Fiduciary, in whole or in 

part, for negligence and/or for any 

violation of state or federal law that may 

be attributable to the Independent 

Fiduciary in performing its duties under 

the captive reinsurance arrangement. In 

addition, no contract or instrument may 

purport to waive any liability under 

state or federal law for any such 

violations. 

Effective Date: This exemption will be 

in effect on the date that this grant 

notice is published in the Federal 

Register. 

Signed at Washington, DC. 

Timothy P. Hauser, 

Deputy Assistant Secretary for Program 

Operations, Employee Benefits Security 

Administration, U.S. Department of Labor. 

[FR Doc. 2022–08305 Filed 4–18–22; 8:45 am] 

BILLING CODE 4510–29–P 

DEPARTMENT OF LABOR 

Employee Benefits Security 

Administration 

[Prohibited Transaction Exemption 2022– 

01; Exemption Application No. D–12065] 

Exemption for Certain Prohibited 

Transaction Restrictions Involving 

Credit Suisse Group AG (CSG or the 

Applicant), Located in Zurich, 

Switzerland 

AGENCY: Employee Benefits Security 

Administration, Labor. 

ACTION: Notice of exemption. 

SUMMARY: This document is a notice of 

exemption issued by the Department of 

Labor (the ‘‘Department’’) from certain 

of the prohibited transaction restrictions 

of the Employee Retirement Income 

Security Act of 1974 (‘‘ERISA’’) and the 

Internal Revenue Code of 1986 (the 

‘‘Code’’). The exemption allows entities 

with specified relationships to Credit 

Suisse AG (‘‘CSAG’’) and Credit Suisse 

Securities (Europe) Limited (‘‘CSSEL’’) 

to continue to rely on the exemptive 

relief provided by Prohibited 

Transaction Class Exemption 84–14, 

notwithstanding the judgments of 

conviction against CSAG and CSSEL, 

described below. 


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23250 Federal Register / Vol. 87, No. 75 / Tuesday, April 19, 2022 / Notices 

1 87 FR 1186 (Jan. 10, 2022). 

2For purposes of this exemption, a ‘‘Covered 

Plan’’ is a plan subject to Part IV of Title I of ERISA 

(an ‘‘ERISA-covered plan’’) or a plan subject to 

Code section 4975 (an ‘‘IRA’’), in each case, with 

respect to which a CS Affiliated QPAM relies on 

PTE 84–14, or with respect to which a CS Affiliated 

QPAM (or any CSAG affiliate) has expressly 

represented that the manager qualifies as a QPAM 

or relies on PTE 84–14. A Covered Plan does not 

include an ERISA-covered plan or IRA to the extent 

the CS Affiliated QPAM has expressly disclaimed 

reliance on QPAM status or PTE 84–14 in entering 

into a contract, arrangement, or agreement with the 

ERISA-covered plan or IRA. Notwithstanding the 

above, a CS Affiliated QPAM may disclaim reliance 

on QPAM status or PTE 84–14 in a written 

modification of a contract, arrangement, or 

agreement with an ERISA-covered plan or IRA, 

where: The modification is made in a bilateral 

document signed by the client; the client’s attention 

is specifically directed toward the disclaimer; and 

the client is advised in writing that, with respect 

to any transaction involving the client’s assets, the 

CS Affiliated QPAM will not represent that it is a 

QPAM, and will not rely on the relief described in 

PTE 84–14. 

DATES: The exemption will be in effect 

for one year beginning on the date of 

conviction of Credit Suisse Securities 

(Europe) Limited in Case Number 1:21– 

cr–00520–WFK. 

FOR FURTHER INFORMATION CONTACT: Erin 

Scott Hesse of the Department at (202) 

693–8546. (This is not a toll-free 

number.) 

SUPPLEMENTARY INFORMATION: On 

January 10, 2022, the Department 

published a notice of proposed 

exemption in the Federal Register 1 for 

certain qualified professional asset 

managers within the corporate family of 

Credit Suisse Group AG (‘‘CSG’’), to 

continue relying on the class exemptive 

relief granted in Prohibited Transaction 

Exemption (PTE) 84–14 (‘‘PTE 84–14’’), 

for up to one year, notwithstanding the 

judgment of conviction against Credit 

Suisse AG (‘‘CSAG’’) and upcoming 

judgment of conviction against Credit 

Suisse Securities (Europe) Limited 

(‘‘CSSEL’’). The Department is granting 

this exemption to ensure that Covered 

Plans and their participants and 

beneficiaries are protected while the 

Department determines whether 

additional relief is warranted.2

The Department stresses that this 

exemption provides Covered Plans and 

CS Affiliated QPAMs with the ability to 

rely on PTE 84–14 for one year and that 

this exemption will terminate at the end 

of that period. The grant of this one-year 

exemption does not imply that the 

Department will grant additional relief 

for the CS Affiliated QPAMs to continue 

to rely on the relief in PTE 84–14 

beyond the end of this exemption’s oneyear term. The Convictions and other 

alleged Credit Suisse-related criminal 

misconduct constitute serious yearslong systemic criminal misconduct that 

counsels against providing broad relief 

from ERISA’s prohibited transaction 

provisions and raises fundamental 

questions regarding whether the CS 

Affiliated QPAMs have sufficient 

integrity to warrant their continued 

reliance on PTE 84–14. 

This exemption provides only the 

relief specified in the text of the 

exemption, and only with respect to the 

criminal convictions or criminal 

conduct described herein. It provides no 

relief from violations of any law other 

than the prohibited transaction 

provisions of Title I of ERISA and the 

Code. 

The Department intends for the terms 

of this exemption to promote adherence 

by the CS Affiliated QPAMs to basic 

fiduciary standards under Title I of 

ERISA and the Code. The Department’s 

primary objective in granting this 

exemption is to ensure that Covered 

Plans can terminate their relationships 

with a CS Affiliated QPAM in an 

orderly and cost-effective fashion in the 

event the fiduciary of a Covered Plan 

determines it is prudent to do so. The 

Department makes the requisite findings 

under ERISA section 408(a) and Code 

Section 4975(c)(2) based on the 

Applicant’s adherence to all the 

conditions of the exemption. 

Accordingly, affected parties should be 

aware that the conditions incorporated 

in this exemption are, taken as a whole, 

necessary for the Department to grant 

the relief requested by the Applicant. 

Absent these or similar conditions, the 

Department would not have granted this 

exemption. 

The Applicant requested an 

individual exemption pursuant to 

ERISA section 408(a) and Code section 

4975(c)(2), and in accordance with the 

procedures set forth in 29 CFR part 

2570, subpart B (76 FR 66637, 66644, 

October 27, 2011). Effective December 

31, 1978, section 102 of the 

Reorganization Plan No. 4 of 1978, 5 

U.S.C. app. 1 (1996), transferred the 

authority of the Secretary of the 

Treasury to issue administrative 

exemptions under Code section 

4975(c)(2) to the Secretary of Labor. 

Accordingly, the Department grants this 

exemption under its sole authority. 

Written Comments 

The Department invited all interested 

persons to submit written comments 

and/or requests for a public hearing 

with respect to the notice of proposed 

exemption (the ‘‘Proposal’’). In this 

regard, the Applicant was given ten (10) 

days to provide notice to interested 

persons, and all comments and requests 

for a hearing were due on February 22, 

2022. The Department received two 

written comments and no hearing 

requests. One comment was from the 

Applicant, as discussed in more detail 

below. The other comment was from 

Senators Elizabeth Warren and Tina 

Smith urging the Department to 

reconsider and rescind the Proposal. 

After considering the entire record 

developed in connection with the 

Applicant’s exemption request, the 

Department has determined to grant the 

one-year exemption to ensure that 

affected plans and their participants are 

protected, as described below. 

Department’s Comment 

The Department cautions that the 

relief in this exemption will terminate 

immediately if an entity within the CSG 

corporate structure is convicted of a 

crime described in Section I(g) of PTE 

84–14 (other than the judgment of 

conviction against CSAG and upcoming 

judgment of conviction against CSSEL, 

as further defined below) during the 

Exemption Period. Although the CS 

Affiliated and Related QPAMs could 

apply for a new exemption in that 

circumstance, the Department would 

not be obligated to grant the exemption. 

The Department designed the terms of 

this exemption to permit plans to 

terminate their relationships in an 

orderly and cost-effective fashion. 

Nothing in this exemption should be 

construed to suggest that the 

Department will grant further relief after 

the expiration of this one-year 

exemption. In this regard, the CS 

Affiliated QPAMs must manage the 

assets of Covered Plan clients consistent 

with this understanding and in 

accordance with their fiduciary 

obligations under ERISA and the 

conditions of this one-year exemption. 

The Department stresses that complying 

with their fiduciary obligations means 

that the CS Affiliated QPAMs’ should 

advise their plan and IRA clients to 

prepare for the possibility that the 

Department will not grant further relief 

at the end of the one-year period and the 

ensuing consequences. This also means 

that the QPAMs should take the 

necessary and appropriate steps to 

ensure their Covered Plan clients will 

not be exposed to prohibited 

transactions and that the QPAMs have 

prudent processes in place to comply 

with the penalty-free withdrawal and 

indemnification requirements set forth 

in Section I(j) of PTE 2019–07 and 

Section III(j) of this exemption. 

Below, the Department provides the 

overview of the relevant convictions, 

which was published in the 


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3 87 FR 1186 (Jan. 10, 2022). 

4The CSAG Statement of Facts defined ‘‘Credit 

Suisse’’ to mean CSAG, its parent, and Switzerlandbased subsidiaries and affiliates, including Clariden 

Leu. 

5 79 FR 68716 (Nov. 18, 2014). 

6 80 FR 59817 (Oct. 2, 2015). PTE 2015–14 

provided relief to the CS Related QPAMs for the 

entire remainder of the ineligibility period. 

7See 84 FR 61928 (Nov. 14, 2019). 

8Unless otherwise specified, all information in 

this section is taken from the Applicant’s 

exemption application and supporting documents, 

the CSSEL Plea Agreement, and the CSSEL 

Statement of Facts. According to the CSSEL Plea 

Agreement ‘‘[t]he Defendant is pleading guilty 

because it is guilty of the charge contained in the 

Information. The Defendant admits, agrees, and 

stipulates that the factual allegations set forth in the 

Information and the Statement of Facts are true and 

correct, that it is responsible for the acts of its 

officers, directors, employees, and agents described 

in the Information and the Statement of Facts, and 

that the Information and the Statement of Facts 

accurately reflect the Defendant’s criminal 

conduct.’’ P. 11. Additionally, as part of the CSSEL 

Plea Agreement, the Defendant ‘‘expressly agrees 

Continued 

Department’s notice of proposed 

exemption.3

Prior 2014 Conviction of CSAG (the 

CSAG Conviction) and Related 

Exemptions 

The CSAG Conviction 

On May 19, 2014, the Tax Division of 

the United States Department of Justice 

(DOJ) and the U.S. Attorney’s Office for 

the Eastern District of Virginia filed a 

one-count criminal information (the 

CSAG Information) in the District Court 

for the Eastern District of Virginia (the 

Virginia District Court) charging CSAG 

with a conspiracy to violate Code 

section 7206(2) in violation of Title 18, 

United States Code, Section 371. The 

CSAG Information charged the 

Applicant and its subsidiaries, Credit 

Suisse Fides and Clariden Leu Ltd., 

with willfully aiding, assisting in, 

procuring, counseling, and advising the 

preparation and presentation of false 

income tax returns and other documents 

to the Internal Revenue Service of the 

Treasury Department (IRS), for decades, 

prior to and through approximately 

2009. 

According to the Statement of Facts 

filed in the criminal case (the CSAG 

Statement of Facts), for decades before 

and through approximately 2009, CSAG 

operated an illegal cross-border banking 

business that knowingly and willfully 

aided and assisted thousands of U.S. 

clients in opening and maintaining 

undeclared accounts concealing their 

offshore assets and income from the IRS. 

Private bankers employed by CSAG 

(referred to as Relationship Managers or 

RMs) served as the primary contact for 

U.S. clients with undeclared accounts at 

CSAG. CSAG used a variety of means to 

assist U.S. clients in concealing their 

undeclared accounts, including by: 

Assisting clients in using sham entities 

as nominee beneficial owners of the 

undeclared accounts; soliciting IRS 

forms that falsely stated under penalty 

of perjury that the sham entities 

beneficially owned the assets in the 

accounts; failing to maintain records in 

the United States related to the 

accounts; destroying account records 

sent to the United States for client 

review; using Credit Suisse 4 managers 

and employees as unregistered 

investment advisors on undeclared 

accounts; facilitating withdrawals of 

funds from undeclared accounts by 

either providing hand-delivered cash in 

the United States or using Credit 

Suisse’s correspondent bank accounts in 

the United States; structuring transfers 

of funds to evade currency transaction 

reporting requirements; and providing 

offshore credit and debit cards to 

repatriate funds in the undeclared 

accounts. 

CSAG made a number of ineffectual 

attempts to consolidate these U.S. 

clients’ accounts in CSAG business 

entities that complied with U.S. law. 

For instance, starting in or about 2009, 

CSAG engaged in a flawed process of 

verifying tax compliance of U.S. 

accounts in order to allow these 

accounts to remain at CSAG. In 

December 2010, the Tax Division of the 

U.S. Department of Justice (DOJ) 

informed Credit Suisse AG that it had 

begun a criminal investigation of CSAG 

that had uncovered evidence of tax law 

violations. Although CSAG had either 

transferred or terminated the majority of 

its relationships with these U.S. clients 

by approximately 2010, CSAG 

continued to identify U.S. customer 

accounts for closure until on or about 

2013. 

On May 19, 2014, pursuant to a plea 

agreement (the CSAG Plea Agreement), 

CSAG entered a plea of guilty for 

assisting U.S. citizens in federal income 

tax evasion. The conviction (the CSAG 

Conviction) occurred on November 21, 

2014. 

Related Individual Exemptions 

In connection with the CSAG 

Conviction, the Department first granted 

PTE 2014–11,5 a one-year exemption 

that allowed CS Affiliated and Related 

QPAMs to continue to rely on PTE 84– 

14, notwithstanding the CSAG 

Conviction, as long as a number of 

conditions were met. Subsequent to 

granting PTE 2014–11, the Department 

granted PTE 2015–14, an additional 

four-year exemption that continued to 

provide extended relief for CS Affiliated 

QPAMs.6 Before the expiration of PTE 

2015–14, the Department granted PTE 

2019–07, which would have provided 

the final five-years of relief CS Affiliated 

needed in connection with the CSAG 

Conviction.7

Impending Conviction of CSSEL (the 

CSSEL Conviction) and CSG Deferred 

Prosecution Agreement (DPA) 

The CSSEL Conviction 

On October 19, 2021, the DOJ, 

Criminal Division, Money Laundering 

and Asset Recovery Section and Fraud 

Section, and the United States 

Attorney’s Office for the Eastern District 

of New York (collectively, the Offices), 

filed a criminal information (the CSSEL 

Information) in the District Court for the 

Eastern District of New York (the New 

York District Court) charging CSSEL 

with one count of conspiracy to commit 

wire fraud in violation of 18 U.S.C. 

1349. As of the date of this publication, 

the CSSEL sentencing date is scheduled 

for May 13, 2022. 

CSSEL agreed to resolve the action 

through a plea agreement presented to 

the New York District Court on October 

19, 2021 (the CSSEL Plea Agreement). 

Under the CSSEL Plea Agreement, 

CSSEL agreed to enter a plea of guilty 

to the charge set out in the CSSEL 

Information (the CSSEL Plea). In 

addition, CSSEL will make an 

admission of guilt to the District Court. 

The Applicant expects that the District 

Court will enter a judgment against 

CSSEL that will require remedies that 

are materially the same as those set forth 

in the CSSEL Plea Agreement. On 

October 19, 2021, in connection with 

the CSSEL Plea, the ultimate parent of 

CSSEL, CSG, entered into a Deferred 

Prosecution Agreement (the DPA) with 

the Criminal Division, Money 

Laundering and Asset Recovery Section 

and Fraud Section of the DOJ and the 

United States Attorney’s Office for the 

Eastern District of New York. 

For purposes of Section I(g) of PTE 

84–14, the date CSSEL is sentenced will 

be the conviction date (the CSSEL 

Conviction Date). As of that date, absent 

this exemption, the CS Affiliated and 

Related QPAMs will no longer be able 

to rely on the relief provided by PTE 

84–14 as of the CSSEL Conviction Date. 

The CSSEL Conviction will also violate 

PTE 2019–07 and therefore, absent this 

exemption, the CS Affiliated and 

Related QPAMs will no longer be able 

to rely on the relief provided by either 

PTE 84–14 or PTE 2019–07 as of the 

CSSEL Conviction Date. 

According to the Statement of Facts 

(the CSSEL Statement of Facts) 8 that 


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23252 Federal Register / Vol. 87, No. 75 / Tuesday, April 19, 2022 / Notices 

that it shall not, through present or future attorneys, 

officers, directors, employees, agents or any other 

person authorized to speak for the Defendant make 

any public statement, in litigation or otherwise, 

contradicting the acceptance of responsibility by 

the Defendant set forth above or the facts described 

in the Information and the Statement of Facts.’’ P. 

23. 9Plea Agreement entered into between the United 

States of America, by and through the United States 

Department of Justice, Criminal Division, Money 

Laundering and Asset Recovery Section and Fraud 

Section, and the United States Attorney’s Office for 

the Eastern District of New York and Credit Suisse 

Securities (Europe) Limited, Cr. No. 21–520 (MKB), 

filed Oct. 19, 2021. 

10EMATUM was a company owned, controlled, 

and overseen by the Government of Mozambique. 

EMATUM was created to undertake a project to 

create a state-owned tuna fishing company for 

Mozambique. 

11The CSSEL Statement of facts defined ‘‘Credit 

Suisse’’ to mean CSG together with its whollyowned subsidiaries and affiliated entities. 

12Privinvest was a holding company based in 

Abu Dhabi, United Arab Emirates. Privinvest was 

engaged in shipbuilding of various types of vessels. 

13ProIndicus was a company owned, controlled, 

and overseen by the Government of Mozambique. 

ProIndicus was created to undertake a project to 

create a state-owned coastal surveillance and 

protection plan for Mozambique. 

14The CSSEL Statement of Facts did not identify 

Privinvest Co-conspirator 1 or Firm 1 other than 

that Firm 1 was a ‘‘diligence firm’’ used by Credit 

Suisse. 

15MAM was a company owned, controlled, and 

overseen by the Government of Mozambique. MAM 

was created to build and maintain shipyards. 

accompanied the CSSEL Plea 

Agreement,9 CSSEL acted as a Joint 

Lead Manager underwriting the 

issuance of $500 million in loan 

participation notes (LPNs) to partially 

finance an $850 million loan for a tuna 

fishing project in Mozambique in 2013, 

and acted as Joint Dealer Manager in the 

exchange of those LPNs for a sovereign 

bond (EMATUM 10 Exchange) 

(collectively, the EMATUM Securities) 

in 2016. 

CSSEL, through its employees, 

conspired to use U.S. wires and the U.S. 

financial system to defraud U.S. and 

international investors. Credit Suisse 11

and its co-conspirators conspired to use 

international and interstate wires to, 

from, and through the United States to 

transmit false and misleading 

statements to investors in the EMATUM 

Securities, transfer proceeds obtained 

from those investors through the 

fraudulent scheme to the coconspirators, and pay kickbacks to three 

former Credit Suisse bankers. 

CSSEL, through Surjan Singh (Singh), 

who left Credit Suisse in 2017, and 

Andrew Pearse (Pearse) and Detelina 

Subeva (Subeva), who both left Credit 

Suisse in 2013, among other things, 

conspired to defraud investors and 

potential investors in the EMATUM 

Securities by concealing and 

misrepresenting the fact that 

approximately $50 million in kickbacks 

were paid to Pearse, Singh, and Subeva 

from the loan proceeds of the EMATUM 

LPN transaction. Jean Boustani, an agent 

of Privinvest,12 an entity not affiliated 

with Credit Suisse, paid bribes totaling 

approximately $150 million to various 

Mozambican government officials and 

others, including Manuel Chang, 

Mozambique’s Minister of Finance, and 

Antonio do Rosario, an official in 

Mozambique’s governmental state 

intelligence and security service, known 

as Servico de Informacoes e Seguranca 

do Estado, which, together with other 

Mozambican government agencies, was 

an owner of ProIndicus 13 and 

EMATUM. 

Credit Suisse also arranged the 

EMATUM Exchange, whereby, in 2015, 

when EMATUM began encountering 

problems servicing the EMATUM loans, 

Credit Suisse arranged for the LPNs to 

be exchanged for Mozambique-issued 

Eurobonds. According to the Statement 

of Facts, in seeking investors’ consent to 

the EMATUM Exchange, CSSEL 

prepared documents about the 

EMATUM Exchange that were sent to 

investors and included false and 

misleading statements regarding the use 

of proceeds of the original EMATUM 

loan and omitted certain other facts 

concerning the EMATUM Exchange. 

Credit Suisse ignored or only nominally 

addressed a number of red flags in 

connection with these transactions. 

On or about August 30, 2013, Credit 

Suisse agreed to move forward with the 

EMATUM transaction. In addition to 

Credit Risk Management, the European 

Investment Banking Committee, 

Reputational Risk, and the Compliance 

and Anti-Money Laundering functions 

considered the transaction and agreed to 

allow the EMATUM transaction to go 

forward. The CSSEL Statement of Facts 

indicates that after Credit Suisse 

transferred the funds raised to finance 

EMATUM to Privinvest, Privinvest 

secretly paid millions of dollars to three 

of the signatories on the EMATUM 

deal—Singh, Do Rosario, and Chang. 

Credit Suisse approved the EMATUM 

loan notwithstanding the fact that its 

earlier due diligence process for 

ProIndicus had identified significant 

risks of bribery and the size of the 

project had expanded greatly without 

apparent justification, and Credit 

Suisse, through Pearse, Singh, and 

Subeva, knew that Privinvest had paid 

kickbacks to Pearse in connection with 

the ProIndicus transaction, and would 

pay further kickbacks to Pearse and 

Singh in connection with the EMATUM 

loan. 

Credit Suisse sent potential investors 

materials that included the EMATUM 

loan agreement and marketing materials 

such as the offering circular (the LPN 

Investor Documents), notwithstanding 

the fact that the LPN Investor 

Documents represented that the loan 

proceeds would be used exclusively to 

fund the EMATUM project, and that 

none of the proceeds would be used to 

pay bribes or kickbacks. For example, 

(a) Pearse and Singh knew that they 

would receive millions of dollars in 

illegal kickback payments from 

Privinvest in connection with the 

EMATUM loan while employed by 

Credit Suisse; (b) Firm 1 had expressly 

warned Credit Suisse about Privinvest 

and Privinvest Co-Conspirator 1’s 

history of corruption and bribery; and 

(c) a senior Credit Suisse executive had 

previously said ‘‘no’’ to Pearse to the 

combination of Privinvest CoConspirator 1 and Mozambique in 

November 2012.14

Despite the use of proceeds concerns 

raised by the significant valuation 

shortfall and other previously identified 

red flags, which underscored the risk 

that the EMATUM proceeds had been 

used for corruption and bribery, Credit 

Suisse approved the EMATUM 

Exchange. Although Credit Suisse did 

disclose in investor documents that it 

had been ‘‘widely reported in the press 

that the proceeds of the [LPNs] had been 

used in part to purchase defense 

equipment,’’ and that ‘‘subsequent press 

reports [had] also called into question 

whether all of the proceeds of the 

[LPNs] were used for authorized or 

appropriate purposes,’’ Credit Suisse 

did not disclose any of the information 

it had about the significant shortfall 

between the price Privinvest charged 

EMATUM for the purchase of assets and 

the value of those assets. In the 

EMATUM Exchange documentation, 

Credit Suisse also: (a) Included false and 

misleading statements regarding the use 

of proceeds of the original EMATUM 

loans; (b) failed to disclose kickbacks to 

Singh, Pearse, and Subeva, of which 

Singh was aware; (c) did not disclose 

any of the information Credit Suisse had 

about the significant shortfall between 

the price Privinvest charged EMATUM 

for the 27 boats and the fair market 

value of those boats; and (d) failed to 

disclose the existence of the ProIndicus 

and MAM loans,15 and their maturity 

dates, and instead disclosed that Credit 

Suisse and VTB Bank ‘‘have engaged, 

and may in the future engage, in 

investment banking and/or commercial 

banking transactions with, and have 

performed and continue to perform 

services for the Issuer and its affiliates 

in the ordinary course of business for 

which they have received and for which 


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they will in the future receive, fees. . . . 

In particular, an affiliate of [CSSEL] has 

a lending relationship with a whollyowned state entity whose obligations 

have the benefit of a guarantee from 

Mozambique.’’ Credit Suisse did 

disclose, however, that it had been 

‘‘widely reported in the press that the 

proceeds of the [LPNs] had been used in 

part to purchase defense equipment,’’ 

and that ‘‘subsequent press reports [had] 

also called into question whether all of 

the proceeds of the [LPNs] were used for 

authorized or appropriate purposes.’’ 

By agreeing to the EMATUM 

Exchange, which delayed the EMATUM 

loan repayment date, Credit Suisse 

knew that EMATUM loan participation 

note investors were agreeing to be paid 

after any other investors in other 

Mozambique government loans that 

matured earlier, such as ProIndicus. 

Credit Suisse arranged and was an 

investor in the ProIndicus loan. As a 

result, by extending the EMATUM loan 

repayment date through the EMATUM 

Exchange, Credit Suisse would be 

repaid on its investment in the private 

ProIndicus loan before EMATUM 

Securities investors were repaid. 

During the investor road show for the 

EMATUM Exchange, Credit Suisse and 

Do Rosario and the then-Minister of 

Finance for Mozambique did not inform 

investors of (a) the significant valuation 

shortfall and risk that loan proceeds 

were improperly diverted, including to 

pay bribes; (b) the existence or maturity 

dates of the ProIndicus and MAM loans; 

(c) that Mozambique had not disclosed 

its true level of debt to the ProIndicus 

and MAM loans to the International 

Monetary Fund (IMF); and (d) kickbacks 

paid to Credit Suisse bankers in 

connection with the EMATUM loan. 

Under the CSSEL Plea Agreement, 

CSSEL agreed, among other things, as 

follows: First, that CSSEL shall 

cooperate fully with the Offices in any 

and all matters relating to the conduct 

described in the CSSEL Plea Agreement 

and the CSSEL Statement of Facts and 

other conduct under investigation by 

the Offices or any other component of 

the Department of Justice at any time 

during the term of the DPA (the Term) 

until the later of the date upon which 

all investigations and prosecutions 

arising out of such conduct are 

concluded or the end of the Term. 

Second, at the request of the Offices, 

CSSEL shall also cooperate fully with 

other domestic or foreign law 

enforcement and regulatory authorities 

and agencies, as well as the Multilateral 

Development Banks in any investigation 

of CSSEL, CSG, its affiliates, or any of 

its present or former officers, directors, 

employees, agents, and consultants, or 

any other party, in any and all matters 

relating to the conduct described in the 

CSSEL Plea Agreement and the CSSEL 

Statement of Facts and any other 

conduct under investigation by the 

Offices or any other component of the 

DOJ. Third, should CSSEL learn during 

the Term of any evidence or allegations 

of conduct that may constitute a 

violation of the federal wire fraud 

statute had the conduct occurred within 

the jurisdiction of the United States, 

CSSEL shall promptly report such 

evidence or allegation to the Offices. 

CSSEL also agreed to commit no further 

crimes and to work with Credit Suisse 

in fulfilling the obligations of CSG’s 

DPA. 

Impacted Investors 

The Applicant represented to the 

Department that the LPNs were 

distributed from Credit Suisse’s UK 

operations via CSSEL into international 

capital markets in 2013, to non-U.S. 

entities, pursuant to U.S. Securities and 

Exchange Commission (SEC) Regulation 

S. Credit Suisse is aware that the 

purchasers of those LPNs were made up 

of hedge funds, banks, and other 

institutions, but due to Regulation S, the 

purchasers’ only obligation was to 

certify their status as Qualified 

Institutional Buyers (QIBs) in the 

applicable subscription agreements. The 

Applicant represents that it is unlikely 

that Covered Plans were initial 

purchasers of those LPNs. According to 

the Applicant, Credit Suisse has no way 

of knowing, and does not know in any 

systematic manner, whether (a) the fund 

owners or investors in the initial 

purchasers’ funds themselves were 

Covered Plans, or (b) parties buying and 

selling the LPNs in the secondary 

market were Covered Plans. 

Furthermore, the Applicant 

represented that in 2016, LPN investors 

had the option to exchange their LPNs 

for sovereign-issued Mozambique 

Exchange Bonds (the Exchange Bonds) 

issued under either Regulation S or SEC 

Rule 144A, in London, England. Credit 

Suisse represents that it is unlikely that 

those investors who chose to exchange 

their LPNs for Regulation S bonds, and 

who must have been QIBs and non-U.S. 

entities, were Covered Plans. The 2016 

Exchange also included a Rule 144A 

tranche into which investors could 

exchange their LPNs; however, those 

buyers also were required to represent 

that they were QIBs, and as a result, it 

is unlikely that their clients were 

Covered Plans. According to the 

information on purchasers which Credit 

Suisse does have, at the time of the 

Exchange, Credit Suisse was aware that 

the LPNs, and subsequently, the 

Eurobonds, were held via either 

Euroclear or Clearstream accounts in 

Europe. While Credit Suisse has 

identified a list of the entities that 

maintained custodial accounts at 

Euroclear and Clearstream in 

connection with those transactions, 

Credit Suisse represents that it has no 

way of knowing the identities of the 

ultimate beneficial owners of the LPNs 

at the time of the Exchange. 

The CSG DPA 

On October 19, 2021, in addition to 

the CSSEL Plea, the ultimate parent 

entity of CSSEL, CSG, entered into a 

three-year DPA with the Offices in 

connection with the same conduct as set 

forth in the CSSEL Statement of Facts 

that forms the basis for the CSSEL Plea 

Agreement. 

The DPA indicates that CSG admits, 

accepts, and acknowledges that it is 

responsible under United States law for 

the acts of its officers, directors, 

employees, and agents as charged in the 

CSSEL Information, and as set forth in 

the CSSEL Statement of Facts, and that 

the allegations described in the CSSEL 

Information and the facts described in 

the CSSEL Statement of Facts are true 

and accurate. 

Under the DPA, CSG also agreed to 

continue to cooperate with the Offices, 

to enhance its compliance program and 

internal controls, and to provide 

enhanced reporting to the Offices on 

CSG’s remediation and compliance 

program. Among other things, the 

enhanced reporting provisions require 

CSG to meet with the Offices at least 

quarterly and to submit yearly reports 

regarding the status of its remediation 

efforts, the results of its testing of its 

compliance program, and its proposals 

to ensure that its compliance program is 

reasonably designed, implemented, and 

enforced so that it is effective in 

deterring and detecting violations of 

fraud, money laundering, the Foreign 

Corrupt Practices Act, and other 

applicable anti-corruption laws. 

Department’s Note: Interested persons 

can access the CSG DPA and related 

materials at https://www.justice.gov/ 

opa/pr/credit-suisse-resolvesfraudulent-mozambique-loan-case-547- 

million-coordinated-global. 

Comments From the Applicant— 

Requested Revisions 

I. Revision to Section I(b) 

Section I(b) of the Proposal provides: 

The term ‘‘Covered Plan’’ means a plan 

subject to Part IV of Title I of ERISA (an 

‘‘ERISA-covered plan’’) or a plan subject to 

Code section 4975 (an ‘‘IRA’’), in each case, 

with respect to which a CS Affiliated QPAM 


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relies on PTE 84–14, or with respect to which 

a CS Affiliated QPAM (or any CSAG affiliate) 

has expressly represented that the manager 

qualifies as a QPAM or relies on the QPAM 

class exemption (PTE 84–14). A Covered Plan 

does not include an ERISA-covered plan or 

IRA to the extent the CS Affiliated QPAM has 

expressly disclaimed reliance on QPAM 

status or PTE 84–14 in entering into a 

contract, arrangement, or agreement with the 

ERISA-covered plan or IRA. 

Applicant’s Request: The Applicant 

requested clarification that a disclaimer 

of reliance on QPAM status or PTE 84– 

14 may be made in a modification of a 

contract, arrangement, or agreement 

with an ERISA-covered plan or IRA, 

assuming a bilateral signed document 

exists, and the client is advised in 

writing what it means not to use the 

QPAM Exemption. According to the 

Applicant, if the agreement is bilateral 

and in writing, and the client’s attention 

is specifically directed toward the 

disclaimer, the Applicant is hopeful that 

the Department will deem these 

conditions sufficiently protective to 

permit the CS Affiliated QPAMs to 

disclaim reliance on QPAM status or 

PTE 84–14 in a modification of a 

contract, arrangement, or agreement. 

Accordingly, the Applicant requested 

the following additional language be 

added to the end of Section I(b): 

Notwithstanding the above, a CS Affiliated 

QPAM may disclaim reliance on QPAM 

status or PTE 84–14 in a written modification 

of a contract, arrangement, or agreement with 

an ERISA-covered plan or IRA, where: The 

modification is made in a bilateral document 

signed by the client; the client’s attention is 

specifically directed toward the disclaimer; 

and the client is advised in writing that, with 

respect to any transaction involving the 

client’s assets, the CS Affiliated QPAM will 

not represent that it is a QPAM, and will not 

rely on the relief described in PTE 84–14. 

Department’s Response: The 

Department has revised the exemption 

consistent with the Applicant’s request. 

II. Revision to Section III(i)(8) 

Section III(i)(8) of the Proposal 

provides, in pertinent part: 

A copy of the Audit Report must be 

provided [to] CSAG’s Board of Directors and 

either the Risk Committee or the Audit 

Committee of CSAG’s Board of Directors; and 

a senior executive officer at either the Risk 

Committee or the Conduct and Financial 

Crime Control Committee must review the 

Audit Report for each CS Affiliated QPAM 

and must certify in writing, under penalty of 

perjury, that such officer has reviewed each 

Audit Report. 

Applicant’s Request: The Applicant 

requested that the Department permit 

certification by the Risk Committee or 

the Audit Committee, rather than the 

Conduct and Financial Crime Control 

Committee. As represented by the 

Applicant, the Audit Committee is 

uniquely positioned to receive and 

review the Audit Report, as its specified 

function is to assist the Board of 

Directors in fulfilling its oversight role 

by monitoring and assessing the 

integrity of Credit Suisse’s financial 

statements. Among the particular 

responsibilities of the Audit Committee 

is monitoring the qualifications, 

independence, and performance of 

external auditors such as the 

Independent Auditor required by the 

Proposal. The Conduct and Financial 

Crime Control Committee does not serve 

a comparable purpose. Its function is 

solely to manage Credit Suisse’s 

exposure to financial crime risk. The 

Applicant submitted that the Audit 

Committee is better suited to fulfill the 

objectives of the exemption condition. 

Accordingly, the Applicant requested 

that the reference to the Conduct and 

Financial Crime Control Committee be 

replaced with the Audit Committee. In 

addition, to the extent that these 

committees include only independent 

Board members and not executive 

employees, the Applicant requested that 

certification be permitted by the 

chairperson of the committee or the 

senior executive officer who acts as 

liaison with the committee. 

Department’s Response: The 

Department has revised the exemption 

consistent with the Applicant’s request 

including so that the chairperson of a 

committee may provide the 

certification. 

III. Revision to Section III(j)(7) 

Section III(j)(7) of the Proposal 

provides, in relevant part: 

For Covered Plans that were provided a 

previous form of investment management 

agreement prior to the effective date of this 

exemption, and sign and return such 

agreement with a CS Affiliated QPAM within 

120 days after the effective date of this 

exemption, the CS Affiliated QPAM shall 

provide the documents required by this 

subsection (j) within ten (10) business days 

after receipt of the signed agreement. This 

condition will be deemed met for each 

Covered Plan that received a notice pursuant 

to PTE 2019–07 that meets the terms of this 

condition. 

Applicant’s Request: The Applicant 

requested clarification with respect to 

Section III(j)(7), which is intended to 

deal with new clients of a CS Affiliated 

QPAM who were provided an 

investment management agreement 

shortly before or after the Proposal was 

published, but in all cases prior to the 

effective date of the exemption, if 

granted. The Applicant requests that 

where that version requires 

modification to meet the terms of the 

exemption, the CS Affiliated QPAM 

may provide amendments required by 

the exemption that need not be signed, 

along with the documents required by 

the exemption. 

The Applicant requested that this part 

of Section III(j)(7) read: 

For new Covered Plans that were provided 

an investment management agreement prior 

to the effective date of this exemption, 

returning it within 120 days after the 

effective date of this exemption, and that 

signed investment management agreement 

requires amendment to meet the terms of the 

exemption, the CS Affiliated QPAM may 

provide the new Covered Plan with 

amendments that need not be signed with 

any documents required by this subsection (j) 

within ten (10) business days after receipt of 

the signed agreement. This condition will be 

deemed met for each Covered Plan that 

received a notice pursuant to PTE 2019–07 

that meets the terms of this condition. 

The Applicant states that handling 

asset management agreements in this 

manner will save affected plans time 

and money. 

Department’s Response: The 

Department has revised the exemption 

as requested. 

IV. Revision to Section III(o) 

Proposed Section III(o) provides 

‘‘CSAG complies in all material respects 

with the requirements imposed by a U.S 

regulatory authority in connection with 

the Convictions.’’ 

Applicant’s Request: The Applicant 

requests that this condition be deleted. 

The Applicant indicated that a number 

of regulators have imposed myriad 

requirements as part of CSAG’s plea 

agreements and settlements entered into 

in connection with the Convictions, 

which are described in detail in the 

Applicant’s application for exemptive 

relief (dated October 19, 2021) and the 

Applicant’s response to the 

Department’s additional questions 

(dated December 9, 2021). The 

Applicant indicated that conditioning 

an administrative exemption upon 

CSAG’s compliance with all such 

requirements does not further the 

objectives of the exemption and, indeed, 

could have a significant adverse effect 

on plans. If CSAG were to fail to meet 

a minor or ministerial requirement, the 

exemption would be lost to plans, 

regardless of whether the regulator 

chose to deal with the failure in a 

different, and less draconian, fashion. 

The Applicant indicated that the CS 

Affiliated QPAMs have no control over 

CSAG and cannot ensure its compliance 

with requirements imposed by other 

regulators. As stated by the Applicant, 

the exemption makes the CS Affiliated 

QPAMs responsible for their own 


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16See 87 FR 1186 at 1187, 1189, 1192, and 1193. 

compliance with the exemption, not for 

the compliance with all other laws by 

the rest of Credit Suisse. The Applicant 

believes that plans and their fiduciaries 

should not pay the price for any 

noncompliance by the non-asset 

management divisions of Credit Suisse. 

The Applicant also contends that this 

kind of provision could have 

unintended consequences. In support of 

that contention, the Applicant indicated 

that: (1) Any claim by a disgruntled 

client or employee, or a competitor, that 

even the most minor requirements of 

these ancillary orders were not met may 

throw the validity of the exemption into 

doubt, causing disruption to the trading 

with respect to Covered Plans, and (2) 

this kind of condition, without notice 

and hearing, creates the sort of cliff 

effect that the Department has sought to 

avoid. Loss, by plans, of this trading 

exemption for failure by a non-asset 

management part of Credit Suisse to 

comply with this condition would serve 

only to penalize plans for conduct that 

is outside their managers’ control. 

The Applicant added that loss of the 

exemption would be automatic upon 

CSAG’s failure to comply with a 

regulatory requirement. By contrast, 

regulators have a broad range of 

potential responses to a failure by CSAG 

or a non-asset management affiliate to 

comply with its terms. Each regulator 

has mechanisms at its disposal, short of 

nullifying the terms of the agreement, to 

ensure CSAG’s compliance with 

requirements imposed by that regulator 

and to monitor satisfaction of them. 

The Applicant further explained that 

there are also bodies of practice and 

precedent within other regulatory 

agencies, which allow for effective but 

modulated enforcement responses in the 

event of a putative technical breach, that 

are inconsistent with the 

unintentionally severe nature of this 

proposed QPAM condition. For 

example, the responsible regulator may 

elect to enforce an agreement without 

disturbing the agreement itself—for 

example, requiring specific performance 

but leaving the plea agreement or other 

settlement intact—whereas this QPAM 

individual exemption would terminate 

immediately upon CSAG’s failure to 

comply. In the Applicant’s words, such 

a severe result would not be in the 

interest of or protective of plans and 

their participants, and, accordingly, the 

Applicant requested that the condition 

be deleted from the final exemption. 

Alternatively, the Applicant requested 

that if the Department decides to retain 

this provision in a final exemption, that 

it be limited to the conditions of the 

plea agreement between CSAG and the 

Department of Justice. 

Department’s Response: The 

Department is not revising the condition 

as requested. The Department views 

CSAG’s compliance in all material 

respects with the requirements imposed 

by a U.S. regulatory authority in 

connection with the Convictions as 

indicative of whether CSAG is acting in 

accordance with U.S-mandated 

requirements, after years of failing to 

abide by U.S. laws. 

However, given the possible costs to 

Covered Plans that may arise if the CS 

Affiliated QPAMs were to suddenly no 

longer able to rely on PTE 84–14, the 

Department has revised the proposed 

language to provide that, ‘‘Relief in this 

exemption will terminate on the date 

that is six months following the date 

that a U.S. regulatory authority makes a 

final decision that CSAG failed to 

comply in all material respects with any 

requirement imposed by such regulatory 

authority in connection with the 

Convictions. 

Importantly, the Department disagrees 

with the Applicant’s characterization 

that ‘‘the exemption makes the CS 

Affiliated QPAMs responsible for their 

own compliance with the exemption, 

not for the compliance with all other 

laws by the rest of Credit Suisse.’’ This 

individual exemption is primarily 

focused on the CS Affiliated QPAMs’ 

compliance with the exemption. The 

Applicant’s statement, however, ignores 

the broader purpose and scope of 

Section I(g), which is precisely why this 

individual exemption is needed. This 

individual exemption is needed because 

the Applicant will no longer be able to 

rely upon PTE 2019–07 or use PTE 84– 

14 once the CSSEL Conviction occurs. 

The terms of this exemption, therefore, 

require full compliance with all of the 

conditions in PTE 84–14. Viewed 

through the lens of PTE 84–14, this 

exemption does not make CS Affiliated 

QPAMs responsible for the compliance 

of the rest of Credit Suisse. Rather, 

entities that are covered by the scope of 

Section I(g) must be vigilant regarding 

their behavior, because it may signal 

larger issues regarding integrity of all 

parts of the organization, including its 

QPAM affiliates or subsidiaries. The 

conduct of entities in a position of 

control or influence over a QPAM are 

explicitly within the scope of Section 

I(g). For instance, if a QPAM itself were 

engaged in misconduct or irregularities 

that a parent entity became aware of, the 

Department has concerns about the 

parent’s willingness to take appropriate 

corrective action, particularly in 

situations where such an entity has 

failed to do so with respect to other nonQPAM entities. The Department’s 

concern, which prompted the 

Department to included Section III(o) in 

the exemption, is consistent with the 

principle of integrity underpinning 

Section I(g) and the foundational 

principles of PTE 84–14. 

Although the Department revised this 

condition slightly as noted above, 

misconduct on behalf of CSAG or other 

Credit Suisse entities or failure to 

comply in all material respects with the 

requirements imposed by a U.S 

regulatory authority in connection with 

the Convictions also would be 

considered relevant to the Department 

in connection with any future 

exemption requests for extended relief 

from the Applicant related to Section 

I(g) ineligibility under exemption. 

Department’s Revisions 

I. Section II 

In Section II, the Department added a 

reference to ‘‘CS Related QPAMs’’ 

which was inadvertently omitted from 

the exemption text. Relief for the CS 

Related QPAMs was indicated in the 

preamble of the Proposal.16

II. Section III(j)(2) 

The Department determined that a 

minor change is necessary to Section 

III(j)(2) in order to ensure that Covered 

Plans are fully and adequately protected 

under the exemption. Proposed Section 

I(j)(2) provides that the CS Affiliated 

QPAM must agree and warrant to 

Covered Plans: 

(2) To indemnify and hold harmless the 

Covered Plan for any actual losses resulting 

directly from a CS Affiliated QPAM’s 

violation of ERISA’s fiduciary duties, as 

applicable, and of the prohibited transaction 

provisions of ERISA and the Code, as 

applicable; a breach of contract by a CS 

Affiliated QPAM; or any claim arising out of 

the failure of such CS Affiliated QPAM to 

qualify for the exemptive relief provided by 

PTE 84–14 as a result of a violation of 

Section I(g) of PTE 84–14 other than the 

Convictions. This condition applies only to 

actual losses caused by the CS Affiliated 

QPAM’s violations[.] 

The Department replaced the 

reference to ‘‘other than the 

Convictions’’ with ‘‘other than the 

CSAG Conviction.’’ Since the CS 

Affiliated QPAMs are in violation of 

Section I(g) due to each of the 

Convictions, this modification is 

necessary to assist plans and IRAs that 

wish to withdraw from their 

arrangement with a CS Affiliated QPAM 

or recover losses as a result of the 

second conviction (i.e., the CSSEL 

Conviction). The Department did not 

intend to carve out this important 

protection, which was intentionally 


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included in PTE 2019–07 to protect 

Plans from costs associated with 

additional misconduct. The Department 

also emphasizes that it views actual 

losses as including losses and related 

costs arising from unwinding 

transactions with third parties and from 

transitioning Plan client assets to an 

alternative asset manager. The 

Department also views actual losses as 

including any exposure on behalf of a 

QPAM’s Plan clients to excise taxes 

under Code section 4975 as a result of 

a CS Affiliated QPAM’s inability to rely 

upon the relief in PTE 84–14. 

II. Section III(k) 

Section III(k) of the Proposal provides, 

in relevant part: 

Within 60 days after the effective date of 

this one-year exemption, each CS Affiliated 

QPAM provides notice of the exemption as 

published in the Federal Register, along with 

a separate summary describing the facts that 

led to the Convictions (the Summary), which 

has been submitted to the Department, . . . 

to each sponsor and beneficial owner of a 

Covered Plan that has entered into a written 

asset or investment management agreement 

with a CS Affiliated QPAM, or the sponsor 

of an investment fund in any case where a 

CS Affiliated QPAM acts as a sub-adviser to 

the investment fund in which such ERISAcovered plan and IRA invests. 

The Department has removed the 

reference to ‘‘separate.’’ This notice of 

exemption includes a description of the 

facts that led to the Convictions, so the 

Department determined that a separate 

Summary is not needed as long as each 

QPAM prominently references the pages 

of the Federal Register where the 

Department’s summary resides. 

III. Section III(s) 

The Department corrected a minor 

typographical error in Section III(s), 

which referred to Section I instead of 

Section III. 

Comments From the Applicant— 

Response to the Department’s Requests 

for Comment in the Proposal 

In the preamble to the Proposal, the 

Department sought comments from 

ERISA-covered plans and IRAs, as well 

as the Applicant, on a variety of topics. 

The Applicant provided responses to 

three of those requests. The first request 

dealt with the validity and magnitude of 

the costs and harms to Covered Plans as 

identified by the Applicant. The second 

request dealt with whether any 

additional relief should be limited to an 

individual exemption that permits the 

types of transactions permitted by PTE 

84–14, but that does not otherwise allow 

Credit Suisse asset managers to refer to 

themselves as QPAMs under PTE 84–14 

with respect to Covered Plans that 

become clients following the CSSEL 

Conviction Date. The third request 

sought comments from interested 

persons regarding any other 

investigations or misconduct (including 

any alleged misconduct) that Credit 

Suisse is a party to which may result in 

criminal prosecution. The Department 

received no responses from ERISAcovered plans and IRAs. Each heading 

below provides the Applicant’s 

response to these comment requests. 

I. Validity and Magnitude of Costs and 

Harms 

The Applicant responded that as set 

forth in the application for relief, the 

decision to propose an exemption 

granting relief will avoid significant 

harm to plan clients, and their 

participants and beneficiaries, that may 

result from such clients being 

compelled to change managers. 

According to the Applicant, an adverse 

decision on the exemption is seen as the 

Department’s vote of no confidence in a 

manager, and thus effectively denies 

plans their preferred manager, which in 

itself is harmful to plans. Unplanned 

asset manager changes would cause 

Covered Plan clients to incur significant 

costs that they otherwise would not 

incur, and that are substantially in 

excess of the transaction costs normally 

associated with transitioning to a 

different manager. Under normal 

circumstances (i.e., if Credit Suisse did 

not lose its individual QPAM 

exemption), clients have generally not 

felt compelled to move from Credit 

Suisse. 

In connection with the original 

exemption issued to the CS Affiliated 

QPAMs, the Applicant provided the 

following cost data, which it has 

reviewed to ensure that those data 

continue to reflect current market 

conditions. As of December 2021, CS 

Affiliated QPAMs manage institutional 

separate accounts for four plans covered 

by ERISA. The ERISA Covered Plans 

account for about $350 million assets 

under management. CS Affiliated 

QPAMs also manage three pooled funds 

trusteed by third parties, which account 

for an aggregate $810 million in assets 

under management that are subject to 

ERISA. 

According to the Applicant, those 

clients chose CS Affiliated QPAMs and 

continue to use CS Affiliated QPAMs 

based on reviews of the Applicant’s 

performance, its legal and compliance 

structure, and its controls, among other 

factors. Assuming such clients could 

find adequate replacement managers, 

those replacements might not have the 

comparable depth, experience in all 

kinds of investment cycles, 

consistency—for example, the three 

most senior investment professionals in 

the Credit strategy discussed below have 

worked together at Credit Suisse for 

more than 20 years—or expertise in 

these more unusual strategies. 

Moreover, the costs to those clients of 

changing managers could be significant, 

given their chosen strategies with Credit 

Suisse. Within traditional stock and 

bond investments, there are hundreds of 

managers offering similar strategies. In 

contrast, fewer managers offer the far 

more specialized strategies pursued by 

the CS Affiliated QPAMs. Smaller still 

is the number of managers offering the 

experience, scale, and performance 

history of the CS Affiliated QPAMs. 

Additionally, selecting a manager 

typically involves an array of steps. 

These may include manager searches 

and circulation of requests for 

proposals, for which consultants may 

charge between $25,000 and $50,000 for 

these unique strategies; extended 

operational investment; due diligence; 

meetings with portfolio managers and 

credit analysts; investment committee 

approvals; establishment of investment 

guidelines; fee negotiations; establishing 

appropriate data feeds and operational 

support; and other contractual 

negotiations such as for ISDAs and 

Master Repurchase Agreements. There 

are legal costs for the plan and for the 

trustee. Altogether, these steps have 

taken as long as 18 months for some 

clients. Thus, it may take a plan sponsor 

a significant amount of time to find and 

implement a new manager if it were 

required to replace Credit Suisse. Its 

clients have spent considerable time 

and resources conducting manager 

searches, and they have selected Credit 

Suisse. There may also be collateral 

consequences for the rest of the plan’s 

portfolio: For example, other strategies 

within the ERISA plan’s portfolio may 

need to be changed to accommodate the 

loss of these strategies. 

The Applicant addressed the specific 

costs of liquidating four applicable 

Credit Suisse strategies: Credit, 

Commodities, Managed Futures, and 

Multi-Alternative. 

Credit Strategy 

According to the Applicant, there 

could be substantial costs in moving to 

a new Credit manager, which a fiduciary 

would typically consider in its 

evaluation of potentially changing 

managers. While some new managers 

might retain certain or even a majority 

of the securities selected by Credit 

Suisse, others would liquidate the 

portfolio so that they can be judged on 

their own investment choices. Credit 

Suisse offers a strategy that is a subset 


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within fixed income relating to senior 

loans, and the number of managers in 

that universe is substantially smaller, 

and smaller still when one looks to the 

experience and scale of Credit Suisse’s 

business. An average bid/ask in this 

asset class may be up to 50 basis points. 

For some unique loans, the spread could 

approach 250 basis points. Additionally, 

one cannot overlook the very real 

possibility that the range and credit 

quality of the investments in a plan’s 

portfolio with Credit Suisse cannot be 

replicated with a new manager. In 

addition, cash settlement times for 

leveraged loans, the largest portion of 

the Credit business, can typically be 

three to four weeks. 

Commodities Strategy 

Another strategy that Credit Suisse 

runs is a diversified commodities index 

strategy. Investors seek exposure to this 

asset class as a portfolio diversifier and 

also use it to potentially hedge against 

unexpected inflation risk. Credit Suisse 

has been managing this strategy on 

behalf of institutional clients since 1994 

and is one of the few managers in this 

space with this amount of experience. 

Credit Suisse believes that it is one of 

the top five asset managers in this 

specific field, measured by assets under 

management. Within its top five peer 

group, Credit Suisse offers a highly 

differentiated investment process, with 

lower volatility versus its investment 

benchmarks, and a conservative 

approach to managing the underlying 

fixed income collateral. In addition, it 

offers a highly flexible and customizable 

platform that its clients may benefit 

from to optimize their portfolio 

investments. 

According to the Applicant, denying 

the individual exemption could subject 

existing ERISA investors to additional 

expenses if they were to unwind 

existing assets. Unwinding this strategy 

would entail all of the legal and other 

general transition costs described above 

in connection with the Credit strategy, 

plus approximately 6–10 basis points to 

liquidate investments and reinvest in 

the new manager’s portfolio. 

Managed Futures Strategy 

The third strategy is the Managed 

Futures strategy, which systematically 

provides exposure to market trends 

across asset classes, geographies, and 

time horizons. Uncorrelated to 

traditional markets, Managed Futures 

aims to generate profits during periods 

when growth-risk-exposed assets 

decline significantly. This profile makes 

it potentially a good portfolio diversifier 

that can help reduce overall portfolio 

risk and improve performance, 

especially in stressed market scenarios. 

The strategy, which has a more than 

five-year track record, is used as an 

industry benchmark and consistently 

ranks as a top performer versus its 

peers. While Credit Suisse competes 

with about a dozen investment 

managers in this strategy, each 

replicates the index differently, and, 

thus, changing managers is effectively 

changing strategies. In addition to the 

legal and other transition costs, the 

liquidation costs are about 10 basis 

points, doubled, of course, to 20 basis 

points, to deal with reinvestment. 

Multi-Alternative Strategy 

The final strategy is the MultiAlternative strategy, which seeks to 

generate attractive risk-adjusted returns 

through an allocation process that 

combines discretionary insights with 

systematic investment tools. It invests 

across a range of asset classes and 

alternative investment styles. The 

strategy aims to limit correlation to 

stocks and bonds, and to manage 

volatility and drawdown risk. It also 

strives to maintain a high degree of 

liquidity and transparency. Cost 

efficiency may increase the strategy’s 

return potential relative to higher-cost 

alternative investment options. While 

Credit Suisse competes with about a 

dozen investment managers in this 

strategy, each replicates the index 

differently, and, thus, as with the 

Managed Futures strategy, changing 

managers is effectively changing 

strategies. In addition to the legal and 

other transition costs, the liquidation 

costs are about 15 basis points, doubled 

to 30 basis points to deal with 

reinvestment. 

Department’s Note: The Department’s 

request was intended to solicit actual 

dollar amounts with respect to the 

strategies noted above as well as the 

impacts on ERISA-covered plans and 

IRAs, as opposed to plans not governed 

by the prohibited transaction provisions 

of Title I of ERISA and the Code. While 

this one-year exemption is intended to 

avoid unnecessary costs to Covered 

Plans as a result of an abrupt loss of 

relief under PTE 84–14, the Department 

wishes to make clear that specific dollar 

amounts of such costs, including those 

associated with exposure to prohibited 

transactions, must be provided by the 

Applicant in support of any request for 

relief beyond the end of this one-year 

exemption. 

II. Restricting Credit Suisse Asset 

Managers From Referring to Themselves 

as QPAMs Under PTE 84–14 

The Applicant responded that 

prohibiting CS Affiliated QPAMs from 

referring to themselves as QPAMs to 

prospective Covered Plan clients would 

defeat the purpose of the exemption and 

is not in the interest of or protective of 

such clients. From the Applicant’s 

perspective, the exemption is intended 

to provide clients access to one of the 

most advantageous trading exemptions 

while ensuring that they are insulated 

from the influence of the bad actors. If 

the CS Affiliated QPAMs are no longer 

able to represent that they are QPAMs, 

Covered Plan clients are far less likely 

to retain the QPAM as their manager, 

even if they otherwise would do so. 

Sophisticated clients know that 

counterparties will not enter into certain 

transactions unless the manager can 

represent both that it is a QPAM, and 

that PTE 84–14 applies. 

According to the Applicant, the 

language proposed suggests that the CS 

Affiliated QPAMs could not represent 

that they were QPAMs in their 

communications and representations to 

counterparties. If that were so, the entire 

purpose of the exemption—to make 

trading more efficient and advantageous 

for Covered Plans—would be thwarted. 

The Applicant added that, put 

differently, the ability to make QPAM 

representations is critical to the plan 

fiduciaries’ diligence, as reflected in the 

Requests for Proposals received by the 

CS Affiliated QPAMs and in plan 

trading. The Applicant feels certain that 

the Department would not want to 

interfere with or hamper the diligence 

those fiduciaries are required to conduct 

or undercut the exemption’s usefulness 

to plans. 

Representing that a manager is a 

QPAM means that it meets the 

definition in Part VI of PTE 84–14—that 

is a section 3(38) manager, that it has 

sufficient net equity, and sufficient 

assets under management. While a 

conviction under Section I(g) prevents a 

CS Affiliated QPAM from using PTE 84– 

14, under the definition in Section VI, 

it still is a QPAM. The Applicant 

indicated that affording the CS 

Affiliated QPAMs use of PTE 84–14 to 

facilitate the strategies that are most 

beneficial to their plan clients, in 

coordination with the imposition of 

carefully targeted protective conditions 

to be assessed by an independent 

auditor, serves the plans’ interests while 

protecting their participants and 

beneficiaries. 

Department’s Note: The Applicant 

appears to misconstrue the larger 

structure of a prohibited transaction 

exemption and its continued availability 

only if the requisite conditions are 

satisfied. The existence of malfeasance 

within a corporate family is an 

important consideration for plan 


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fiduciaries when deciding upon a 

discretionary asset manager, particularly 

one calling itself a QPAM and relying 

upon PTE 84–14. Therefore, the ability 

of a QPAM and its client plans to 

continue to rely upon the exemption is 

directly linked to Section I(g). 

Regardless of the plan fiduciary’s choice 

to select Credit Suisse as an asset 

manager, the relief under the exemption 

is tied to the integrity condition in 

Section I(g) as a protection not only to 

plan fiduciaries but to the plan 

participants whose benefits are 

ultimately at risk when it appears there 

may be a malfeasance and legal 

compliance problem within an entire 

corporate family. Section I(g) is an 

integral part of PTE 84–14 that 

establishes a level of integrity to justify, 

in the Applicant’s words, the 

availability of ‘‘one of the most 

advantageous trading exemptions’’ and 

the corresponding ability to don the 

QPAM badge. Any client plan that 

chooses to retain the QPAM as an asset 

manager after a loss of relief under PTE 

84–14 may do so but would need to 

proceed under alternative exemptions or 

otherwise in full compliance with the 

prohibited transaction provisions under 

Title I of ERISA and the Code. 

Moreover, the Department strongly 

disagrees that an asset manager’s ability 

to make QPAM representations is 

critical to the diligence of plan 

fiduciaries. In granting PTE 84–14, the 

Department did not intend that an asset 

manager’s ability to rely on PTE 84–14 

would constitute a badge of 

sophistication or expertise. The class 

exemption does not contain any 

sophistication or expertise standards or 

requirements, nor did the Department 

include any discussion in prior 

preambles suggesting that was the intent 

of any of the exemption’s conditions. 

Rather, the class exemption was 

intended as an effective and efficient 

means for an asset manager to engage in 

a wide range of beneficial plan 

transactions that are otherwise 

prohibited by Title I of ERISA and the 

Code if the conditions of the exemption 

are met. Plan fiduciaries should not 

view an asset manager’s status as a 

QPAM and ability to rely upon PTE 84– 

14 as an endorsement by the 

Department of that asset manager, an 

indication that the asset manager is 

uniquely qualified to manage the plan’s 

assets, that the asset manager will be 

more likely to act prudently, or that the 

asset manager is more likely to act with 

integrity. 

Transactional counterparties that 

require QPAM status do so for their own 

reasons, including reasons that are 

unrelated to the interests of and 

protection of a plan. If a plan fiduciary 

views an asset manager’s status as a 

QPAM as beneficial to the management 

of the plan’s assets, the fiduciary should 

strongly consider the asset manager’s 

ability to comply with, and continue to 

comply with, the conditions of PTE 84– 

14 in selecting and/or retaining the 

QPAM. This includes monitoring the 

asset manager’s ability to comply with 

Section I(g). 

The Department is therefore not 

persuaded that an exemption which 

permits transactions that are similar to 

those covered by PTE 84–14 could not 

be designed to provide the same 

efficiencies as PTE 84–14. The 

Department is also not persuaded that 

such an approach would be harmful to 

plans managed by asset managers that 

do not qualify as QPAMs due to a 

failure to comply with Section I(g) of the 

PTE 84–14. 

III. Investigations or Misconduct 

(Including Any Alleged Misconduct) 

According to the Applicant, the third 

question invites the general public to 

raise every potential disagreement they 

may have with any part of the Credit 

Suisse worldwide organization, 

regardless of whether the conduct is 

criminal, whether regulators or courts 

have already dismissed those claims, 

whether the claims have even been 

brought to the attention of the regulator, 

whether the commenter is correct that 

the conduct could be criminal, and 

whether the conduct has anything to do 

with asset management. The Applicant 

submits that the granting of the 

exemption should not depend upon 

public allegations of wrongdoing, 

regardless of where in the world it 

occurred, including outside the separate 

asset management division and not 

involving the CS Affiliated QPAMs. 

The Applicant indicated that it 

brought one matter to the attention of 

the Department in 2019. CSAG has been 

responding to an investigation by the 

Swiss Office of the Attorney General 

(‘‘SOAG’’) concerning the diligence and 

controls applied to a historical 

relationship with Bulgarian former 

clients who are alleged to have 

laundered funds through CSAG 

accounts. On December 17, 2020, the 

SOAG brought charges against CSAG 

and other parties under Article 102 of 

the Swiss Criminal Code. Trial in this 

matter commenced in the Swiss Federal 

Criminal Court on February 7, 2022, and 

was scheduled to conclude on or about 

March 3, 2022. The Applicant 

represented that Article 102 liability is 

not classified as a felony or a 

misdemeanor under Swiss law and is 

outside the scope of section I(g) of PTE 

84–14. 

The Applicant indicated that other 

investigations are described in the 

Applicant’s public securities laws 

disclosures. 

Department’s Note: The Department 

did not indicate in its request for 

comment that reporting investigations 

or misconduct (including any alleged 

misconduct) in connection with the 

exemption request would cause the 

Department to deny the exemption. 

However, investigations or misconduct 

founded upon well-verified facts, in 

particular, are an appropriate 

consideration for the Department when 

determining whether to grant any 

exemption. Such information may 

require, at a minimum, additional 

protective conditions to deal with any 

actual or potential harm to plans and 

IRAs that cannot be ignored in light of 

the statutory criteria for granting an 

exemption under ERISA section 408(a) 

and Code section 4975(c)(2). 

General Information 

The attention of interested persons is 

directed to the following: 

(1) The fact that a transaction is the 

subject of an exemption under ERISA 

section 408(a) and/or Code section 

4975(c)(2) does not relieve a fiduciary or 

other party in interest or disqualified 

person from certain other provisions of 

ERISA and/or the Code, including any 

prohibited transaction provisions to 

which the exemption does not apply 

and the general fiduciary responsibility 

provisions of ERISA section 404, which, 

among other things, require a fiduciary 

to discharge his duties respecting the 

plan solely in the interest of the 

participants and beneficiaries of the 

plan and in a prudent fashion in 

accordance with ERISA section 

404(a)(1)(B); nor does it affect the 

requirement of Code section 401(a) that 

the plan must operate for the exclusive 

benefit of the employees of the 

employer maintaining the plan and their 

beneficiaries; 

(2) Before an exemption may be 

granted under ERISA section 408(a) 

and/or Code section 4975(c)(2), the 

Department must find that the 

exemption is administratively feasible, 

in the interests of the plan and of its 

participants and beneficiaries, and 

protective of the rights of participants 

and beneficiaries of the plan; 

(3) The exemption is supplemental to, 

and not in derogation of, any other 

provisions of ERISA and/or the Code, 

including statutory or administrative 

exemptions and transitional rules. 

Furthermore, the fact that a transaction 

is subject to an administrative or 


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17For purposes of this one-year exemption, 

references to ERISA section 406, unless otherwise 

specified, should be read to refer as well to the 

corresponding provisions of Code section 4975. 

18 In general terms, a QPAM is an independent 

fiduciary that is a bank, savings and loan 

association, insurance company, or investment 

adviser that meets certain equity or net worth 

requirements and other licensure requirements and 

that has acknowledged in a written management 

agreement that it is a fiduciary with respect to each 

plan that has retained the QPAM. 

19 49 FR 9494 (March 13, 1984), as corrected at 

50 FR 41430, (Oct. 10, 1985), as amended at 70 FR 

49305 (Aug. 23, 2005), and as amended at 75 FR 

38837 (July 6, 2010). 

statutory exemption is not dispositive of 

whether the transaction is in fact a 

prohibited transaction; and 

(4) The exemption is subject to the 

express condition that the material facts 

and representations contained in each 

application are true and complete, and 

that each application accurately 

describes all material terms of the 

transaction which is the subject of the 

exemption. 

Accordingly, the following exemption 

is granted under the authority of ERISA 

section 408(a) and Code section 

4975(c)(2) and in accordance with the 

procedures set forth in 29 CFR part 

2570, subpart B (76 FR 66637, 66644, 

October 27, 2011): 

One-Year Exemption 

The Department is granting this oneyear exemption under the authority of 

ERISA section 408(a) and Internal 

Revenue Code (or Code) section 

4975(c)(2), and in accordance with the 

procedures set forth in 29 CFR part 

2570, subpart B (76 FR 66637, 66644, 

October 27, 2011).17 Effective December 

31, 1978, section 102 of Reorganization 

Plan No. 4 of 1978, 5 U.S.C. app. 1 

(1996), transferred the authority of the 

Secretary of the Treasury to issue 

exemptions of the type requested to the 

Secretary of Labor. Therefore, this 

notice of exemption is issued solely by 

the Department. 

Section I. Definitions 

(a) The term ‘‘Convictions’’ means (1) 

the judgment of conviction against 

CSAG for one count of conspiracy to 

violate section 7206(2) of the Internal 

Revenue Code in violation of Title 18, 

United States Code, Section 371, that 

was entered in the District Court for the 

Eastern District of Virginia in Case 

Number 1:14–cr–188–RBS, on 

November 21, 2014 (the ‘‘CSAG 

Conviction’’); and (2) the judgment of 

conviction against CSSEL, when it is 

entered, in Case Number 1:21–cr– 

00520–WFK (the ‘‘CSSEL Conviction’’). 

(b) The term ‘‘Covered Plan’’ means a 

plan subject to Part IV of Title I of 

ERISA (an ‘‘ERISA-covered plan’’) or a 

plan subject to Code section 4975 (an 

‘‘IRA’’), in each case, with respect to 

which a CS Affiliated QPAM relies on 

PTE 84–14, or with respect to which a 

CS Affiliated QPAM (or any CSAG 

affiliate) has expressly represented that 

the manager qualifies as a QPAM or 

relies on PTE 84–14. A Covered Plan 

does not include an ERISA-covered plan 

or IRA to the extent the CS Affiliated 

QPAM has expressly disclaimed 

reliance on QPAM status or PTE 84–14 

in entering into a contract, arrangement, 

or agreement with the ERISA-covered 

plan or IRA. Notwithstanding the above, 

a CS Affiliated QPAM may disclaim 

reliance on QPAM status or PTE 84–14 

in a written modification of a contract, 

arrangement, or agreement with an 

ERISA-covered plan or IRA, where: the 

modification is made in a bilateral 

document signed by the client; the 

client’s attention is specifically directed 

toward the disclaimer; and the client is 

advised in writing that, with respect to 

any transaction involving the client’s 

assets, the CS Affiliated QPAM will not 

represent that it is a QPAM, and will not 

rely on the relief described in PTE 84– 

14. 

(c) The term ‘‘CSAG’’ means Credit 

Suisse AG. 

(d) The term ‘‘CSSEL’’ means Credit 

Suisse Securities (Europe) Limited. 

(e) The term ‘‘CS Affiliated QPAM’’ 

means Credit Suisse Asset Management, 

LLC (‘‘CSAM LLC’’) and Credit Suisse 

Asset Management Limited (‘‘CSAM 

Ltd.’’) and any current or future 

‘‘affiliate’’ of CSAG or CSSEL (as 

defined in Part VI(d) of PTE 84–14) that 

qualifies as a ‘‘qualified professional 

asset manager’’ (as defined in Section 

VI(a) of PTE 84–14) 18 and that relies on 

the relief provided by PTE 84–14 and 

with respect to which CSAG or CSSEL 

is a current or future ‘‘affiliate’’ (as 

defined in Section VI(d) of PTE 84–14), 

but is not a CS Related QPAM. The term 

‘‘CS Affiliated QPAM’’ excludes CSAG 

and CSSEL. 

(f) The term ‘‘CS Related QPAM’’ 

means any current or future ‘‘qualified 

professional asset manager’’ (as defined 

in Section VI(a) of PTE 84–14) that 

relies on the relief provided by PTE 84– 

14, and with respect to which CSAG or 

CSSEL owns a direct or indirect five (5) 

percent or more interest, but with 

respect to which CSAG or CSSEL is not 

an ‘‘affiliate’’ (as defined in section 

VI(d)(1) of PTE 84–14) The term ‘‘CS 

Related QPAM’’ excludes CSAG and 

CSSEL. 

(g) The term ‘‘Exemption Period’’ 

means the one-year period that begins 

on the date of the CSSEL Conviction. 

(h) The term ‘‘CSAG Plea Agreement’’ 

means the plea agreement entered into 

between the United States of America, 

by and through the United States 

Department of Justice, and the United 

States Attorney’s Office for the Eastern 

District of Virginia, and CSSEL in Case 

Number 1:14–cr–188–RBS. 

(i) The term ‘‘CSSEL Plea Agreement’’ 

means the plea agreement entered into 

between the United States of America, 

by and through the United States 

Department of Justice, Criminal 

Division, Money Laundering and Asset 

Recovery Section and Fraud Section, 

and the United States Attorney’s Office 

for the Eastern District of New York, and 

CSSEL in Case Number 1:21–cr–00520– 

WFK. 

Section II. Covered Transactions 

The CS Affiliated QPAMs, as defined 

in Section I(e), and the CS Related 

QPAMs, as defined in Section I(f), will 

not be precluded from relying on the 

exemptive relief provided by Prohibited 

Transaction Class Exemption 84–14 

(PTE 84–14) 19 during the Exemption 

Period, notwithstanding the 

‘‘Convictions’’ against CSAG and CSSEL 

(as defined in Section I(a)), provided 

that the conditions in Section III are 

satisfied. 

Section III. Conditions 

(a) The CS Affiliated QPAMs and the 

CS Related QPAMs (including their 

officers, directors, agents other than 

CSG, CSAG, and CSSEL, employees of 

such QPAMs, and CSAG employees that 

do work for CS Affiliated or Related 

QPAMs described in subparagraph (d) 

below) did not know or did not have 

reason to know of and did not 

participate in the criminal conduct of 

CSAG and CSSEL that is the subject of 

the Convictions. Further, any other 

party engaged on behalf of the CS 

Affiliated QPAMs and CS Related 

QPAMs who had responsibility for, or 

exercised authority in connection with 

the management of plan assets did not 

know or have reason to know of and did 

not participate in the criminal conduct 

that is the subject of the Convictions. 

For purposes of this exemption, 

including paragraph (c) below, 

‘‘participate in’’ refers not only to active 

participation in the criminal conduct of 

CSAG and CSSEL that is the subject of 

the Convictions, but also to knowing 

approval of the criminal conduct, or 

knowledge of such conduct without 

taking active steps to prohibit such 

conduct, including reporting the 

conduct to the individual’s supervisors, 

and to the Board of Directors. 

(b) The CS Affiliated QPAMs and the 

CS Related QPAMs (including their 


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officers, directors, agents other than 

CSAG, employees of such QPAMs, and 

CSAG employees described in 

subparagraph (d)(3) below) did not 

receive direct compensation, or 

knowingly receive indirect 

compensation, in connection with the 

criminal conduct of that is the subject 

of the Convictions. Further, any other 

party engaged on behalf of the CS 

Affiliated QPAMs and the CS Related 

QPAMs who had responsibility for, or 

exercised authority in connection with 

the management of plan assets did not 

receive direct compensation, or 

knowingly receive indirect 

compensation, in connection with the 

criminal conduct of that is the subject 

of the subject of the Convictions; 

(c) The CS Affiliated QPAMs do not 

currently and will not in the future 

employ or knowingly engage any of the 

individuals who participated in the 

criminal conduct of CSAG and CSSEL 

that is the subject of the Convictions; 

(d) At all times during the Exemption 

Period, no CS Affiliated QPAM will use 

its authority or influence to direct an 

‘‘investment fund’’ (as defined in 

Section VI(b) of PTE 84–14) that is 

subject to ERISA or the Code and 

managed by such CS Affiliated QPAM 

with respect to one or more Covered 

Plans, to enter into any transaction with 

CSAG or CSSEL or to engage CSAG or 

CSSEL to provide any service to such 

investment fund, for a direct or indirect 

fee borne by such investment fund, 

regardless of whether such transaction 

or service may otherwise be within the 

scope of relief provided by an 

administrative or statutory exemption. 

A CS Affiliated QPAM will not fail this 

condition solely because: 

(1) A CSAG affiliate serves as a local 

sub-custodian that is selected by an 

unaffiliated global custodian that, in 

turn, is selected by someone other than 

a CS Affiliated QPAM or CS Related 

QPAM; 

(2) CSAG provides only necessary, 

non-investment, non-fiduciary services 

that support the operations of CS 

Affiliated QPAMs, at the CS Affiliated 

QPAM’s own expense, and the Covered 

Plan is not required to pay any 

additional fee beyond its agreed-to asset 

management fee. This exception does 

not permit CSAG or its branches to 

provide any service to an investment 

fund managed by a CS Affiliated QPAM 

or CS Related QPAM; or 

(3) CSAG employees are doublehatted, seconded, supervised, or subject 

to the control of a CS Affiliated QPAM; 

(e) Any failure of a CS Affiliated 

QPAM to satisfy Section I(g) of PTE 84– 

14 arose solely from the Convictions; 

(f) A CS Affiliated QPAM or a CS 

Related QPAM did not exercise 

authority over the assets of any plan 

subject to Part 4 of Title I of ERISA (an 

‘‘ERISA-covered plan’’) or Code section 

4975 (an ‘‘IRA’’) in a manner that it 

knew or should have known would 

further the criminal conduct that is the 

subject of the Convictions; or cause the 

CS Affiliated QPAM or CS Related 

QPAM or its affiliates to directly or 

indirectly profit from the criminal 

conduct that is the subject of the 

Convictions; 

(g) Neither CSAG nor CSSEL will act 

as a fiduciary within the meaning of 

ERISA section 3(21)(A)(i) or (iii), or 

Code section 4975(e)(3)(A) and (C), with 

respect to ERISA-covered Plan and IRA 

assets, except that each may act as such 

a fiduciary (1) with respect to employee 

benefit plans sponsored for its own 

employees or employees of an affiliate; 

or (2) in connection with securities 

lending services of the New York 

Branch of CSAG. Neither CSAG nor 

CSSEL will be treated as violating the 

conditions of the exemption solely 

because it acted as an investment advice 

fiduciary within the meaning of ERISA 

section 3(21)(A)(ii) or Code section 

4975(e)(3)(B); 

(h)(1) Each CS Affiliated QPAM must 

maintain, adjust (to the extent 

necessary), implement, and follow the 

written policies and procedures 

described below (the Policies). 

Notwithstanding the preceding 

sentence, a CS Affiliated QPAM may not 

engage in any transaction or 

arrangement described in Section 

III(d)(1) through (3) of this exemption 

before the date the Policies below have 

been developed, implemented, and 

followed. The Policies must require and 

must be reasonably designed to ensure 

that: 

(i) The asset management decisions of 

the CS Affiliated QPAM are conducted 

independently of CSAG’s and CSSEL’s 

corporate management and business 

activities, and without considering any 

fee a CS-related local sub-custodian may 

receive from those decisions. This 

condition does not preclude a CS 

Affiliated QPAM from receiving 

publicly available research and other 

widely available information from a 

CSAG affiliate other than CSSEL; 

(ii) The CS Affiliated QPAM fully 

complies with ERISA’s fiduciary duties, 

and with ERISA and the Code’s 

prohibited transaction provisions, in 

each case as applicable with respect to 

each Covered Plan, and does not 

knowingly participate in any violation 

of these duties and provisions with 

respect to Covered Plans; 

(iii) The CS Affiliated QPAM does not 

knowingly participate in any other 

person’s violation of ERISA or the Code 

with respect to Covered Plans; 

(iv) Any filings or statements made by 

the CS Affiliated QPAM to regulators, 

including but not limited to, the 

Department, the Department of the 

Treasury, the Department of Justice, and 

the Pension Benefit Guaranty 

Corporation, on behalf of or in relation 

to Covered Plans, are materially 

accurate and complete, to the best of 

such QPAM’s knowledge at that time; 

(v) To the best of its knowledge at that 

time, the CS Affiliated QPAM does not 

make material misrepresentations or 

omit material information in its 

communications with such regulators 

with respect to Covered Plans, or make 

material misrepresentations or omit 

material information in its 

communications with Covered Plans; 

and 

(vi) The CS Affiliated QPAM complies 

with the terms of this one-year 

exemption, and CSAG complies with 

the terms of Section III(d)(2); 

(2) Any violation of, or failure to 

comply with an item in subparagraphs 

(h)(1)(ii) through (vi), is corrected as 

soon as reasonably possible upon 

discovery, or as soon after the QPAM 

reasonably should have known of the 

noncompliance (whichever is earlier), 

and any such violation or compliance 

failure not so corrected is reported, 

upon the discovery of such failure to so 

correct, in writing. This report must be 

made to the head of compliance and the 

general counsel (or their functional 

equivalent) of the relevant CS Affiliated 

QPAM that engaged in the violation or 

failure, and the independent auditor 

responsible for reviewing compliance 

with the Policies. A CS Affiliated QPAM 

will not be treated as having failed to 

develop, implement, maintain, or follow 

the Policies, provided that it corrects 

any instance of noncompliance as soon 

as reasonably possible upon discovery, 

or as soon as reasonably possible after 

the CS Affiliated QPAM reasonably 

should have known of the 

noncompliance (whichever is earlier), 

and provided that it adheres to the 

reporting requirements set forth in this 

subparagraph (2); 

(3) Each CS Affiliated QPAM must 

maintain, adjust (to the extent 

necessary), and implement or continue 

a program of training during the 

Exemption Period (the Training), to be 

conducted at least annually, for all 

relevant CS Affiliated QPAM asset/ 

portfolio management, trading, legal, 

compliance, and internal audit 

personnel. The Training must: 


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(i) At a minimum, cover the Policies, 

ERISA and Code compliance (including 

applicable fiduciary duties and the 

prohibited transaction provisions), 

ethical conduct, the consequences for 

not complying with the conditions of 

this exemption (including any loss of 

exemptive relief provided herein), and 

the requirement for prompt reporting of 

wrongdoing; and 

(ii) Be conducted by a professional 

who has been prudently selected and 

who has appropriate technical training 

and proficiency with ERISA and the 

Code to perform the tasks required by 

this exemption; and 

(iii) Be conducted in-person, 

electronically, or via a website; 

(i)(1) Each CS Affiliated QPAM 

submits to an audit by an independent 

auditor, who has been prudently 

selected and who has appropriate 

technical training and proficiency with 

ERISA and the Code, to evaluate the 

adequacy of, and each CS Affiliated 

QPAM’s compliance with, the Policies 

and Training described herein. The 

audit requirement must be incorporated 

in the Policies. The audit must cover the 

12-month period that begins on 

November 21, 2021. The audit must be 

completed no later than 180 days after 

the period to which it applies (May 19, 

2023); 

(2) Within the scope of the audit and 

to the extent necessary for the auditor, 

in its sole opinion, to complete its audit 

and comply with the conditions for 

relief described herein, and only to the 

extent such disclosure is not prevented 

by state or federal statute, or involves 

communications subject to attorney 

client privilege, each CS Affiliated 

QPAM and, if applicable, CSAG, will 

grant the auditor unconditional access 

to its business, including, but not 

limited to: Its computer systems; 

business records; transactional data; 

workplace locations; training materials; 

and personnel. Such access is limited to 

information relevant to the auditor’s 

objectives as specified by the terms of 

this exemption; 

(3) The auditor’s engagement must 

specifically require the auditor to 

determine whether each CS Affiliated 

QPAM has developed, implemented, 

maintained, and followed the Policies in 

accordance with the conditions of this 

one-year exemption, and has developed 

and implemented the Training, as 

required herein; 

(4) The auditor’s engagement must 

specifically require the auditor to test 

each CS Affiliated QPAM’s operational 

compliance with the Policies and 

Training. In this regard, the auditor 

must test, for each CS Affiliated QPAM, 

a sample of such: (1) CS Affiliated 

QPAM’s transactions involving Covered 

Plans; (2) each CS Affiliated QPAM’s 

transactions involving CSAG affiliates 

that serve as a local sub-custodian. The 

samples must be sufficient in size and 

nature to afford the auditor a reasonable 

basis to determine such CS Affiliated 

QPAM’s operational compliance with 

the Policies and Training; 

(5) For each audit, on or before the 

end of the relevant period described in 

Section III(i)(1) for completing the audit, 

the auditor must issue a written report 

(the Audit Report) to CSAG and the CS 

Affiliated QPAM to which the audit 

applies that describes the procedures 

performed by the auditor in connection 

with its examination. The auditor, at its 

discretion, may issue a single 

consolidated Audit Report that covers 

all the CS Affiliated QPAMs. The Audit 

Report must include the auditor’s 

specific determinations regarding: 

(i) The adequacy of each CS Affiliated 

QPAM’s Policies and Training; each CS 

Affiliated QPAM’s compliance with the 

Policies and Training; the need, if any, 

to strengthen such Policies and 

Training; and any instance of the 

respective CS Affiliated QPAM’s 

noncompliance with the written 

Policies and Training described in 

Section III(h) above. The CS Affiliated 

QPAM must promptly address any 

noncompliance. The CS Affiliated 

QPAM must promptly address or 

prepare a written plan of action to 

address any determination as to the 

adequacy of the Policies and Training 

and the auditor’s recommendations (if 

any) with respect to strengthening the 

Policies and Training of the respective 

CS Affiliated QPAM. Any action taken 

or the plan of action to be taken by the 

respective CS Affiliated QPAM must be 

included in an addendum to the Audit 

Report (such addendum must be 

completed prior to the certification 

described in Section III(i)(7) below). In 

the event such a plan of action to 

address the auditor’s recommendation 

regarding the adequacy of the Policies 

and Training is not completed by the 

time of submission of the Audit Report, 

the following period’s Audit Report 

must state whether the plan was 

satisfactorily completed. Any 

determination by the auditor that a CS 

Affiliated QPAM has implemented, 

maintained, and followed sufficient 

Policies and Training must not be based 

solely or in substantial part on an 

absence of evidence indicating 

noncompliance. In this last regard, any 

finding that a CS Affiliated QPAM has 

complied with the requirements under 

this subparagraph must be based on 

evidence that the particular CS 

Affiliated QPAM has actually 

implemented, maintained, and followed 

the Policies and Training required by 

this exemption. Furthermore, the 

auditor must not solely rely on the 

Annual Exemption Report created by 

the Compliance Officer, as described in 

Section III(m) below, as the basis for the 

auditor’s conclusions in lieu of 

independent determinations and testing 

performed by the auditor as required by 

Section III(i)(3) and (4) above; and 

(ii) The adequacy of the Exemption 

Review described in Section III(m); 

(6) The auditor must notify the 

respective CS Affiliated QPAM of any 

instance of noncompliance identified by 

the auditor within five (5) business days 

after such noncompliance is identified 

by the auditor, regardless of whether the 

audit has been completed as of that 

date; 

(7) With respect to the Audit Report, 

the general counsel, or one of the three 

most senior executive officers of the CS 

Affiliated QPAM to which the Audit 

Report applies, must certify in writing, 

under penalty of perjury, that the officer 

has reviewed the Audit Report and this 

exemption; that, to the best of such 

officer’s knowledge at the time, the CS 

Affiliated QPAM has addressed, 

corrected, and remedied any 

noncompliance and inadequacy or has 

an appropriate written plan to address 

any inadequacy regarding the Policies 

and Training identified in the Audit 

Report. This certification must also 

include the signatory’s determination 

that, to the best of the officer’s 

knowledge at the time, the Policies and 

Training in effect at the time of signing 

are adequate to ensure compliance with 

the conditions of this exemption, and 

with the applicable provisions of ERISA 

and the Code. Notwithstanding the 

above, no person, including any person 

referenced in the CSAG or CSSEL 

Statement of Facts that gave rise to the 

CSAG or CSSEL Plea Agreement, who 

knew of, or should have known of, or 

participated in, any misconduct 

described in the CSAG or CSSEL 

Statement of Facts, by any party, may 

provide the certification required by this 

exemption, unless the person took 

active documented steps to stop the 

misconduct; 

(8) A copy of the Audit Report must 

be provided to CSAG’s Board of 

Directors and either the Risk Committee 

or the Audit Committee of CSAG’s 

Board of Directors; and a senior 

executive officer or chairperson of either 

the Risk Committee or the Audit 

Committee must review the Audit 

Report for each CS Affiliated QPAM and 

must certify in writing, under penalty of 

perjury, that such person has reviewed 

each Audit Report; 


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(9) Each CS Affiliated QPAM provides 

its certified Audit Report, by regular 

mail to: Office of Exemption 

Determinations (OED), 200 Constitution 

Avenue NW, Suite 400, Washington, DC 

20210, or by private carrier to: 122 C 

Street NW, Suite 400, Washington, DC 

20001–2109. The delivery must take 

place no later than 45 days following 

completion of the Audit Report. The 

Audit Report will be made part of the 

public record regarding this one-year 

exemption. Furthermore, each CS 

Affiliated QPAM must make its Audit 

Reports unconditionally available, 

electronically or otherwise, for 

examination upon request by any duly 

authorized employee or representative 

of the Department, other relevant 

regulators, and any fiduciary of a 

Covered Plan; 

(10) Any engagement agreement with 

an auditor to perform the audit required 

by this exemption must be submitted to 

OED no later than two (2) months after 

the execution of such agreement; 

(11) The auditor must provide the 

Department, upon request, for 

inspection and review, access to all the 

workpapers created and used in 

connection with the audit, provided 

such access, inspection, and review is 

otherwise permitted by law; and 

(12) CSAG and/or the CS Affiliated 

QPAM must notify the Department of a 

change in the independent auditor no 

later than two (2) months after the 

engagement of a substitute or 

subsequent auditor and must provide an 

explanation for the substitution or 

change including a description of any 

material disputes involving the 

terminated auditor and CSAG and/or 

the CS Affiliated QPAMs; 

(j) As of the effective date of this oneyear exemption, with respect to any 

arrangement, agreement, or contract 

between a CS Affiliated QPAM and a 

Covered Plan, the CS Affiliated QPAM 

agrees and warrants to Covered Plans: 

(1) To comply with ERISA and the 

Code, as applicable with respect to such 

Covered Plan; to refrain from engaging 

in prohibited transactions that are not 

otherwise exempt (and to promptly 

correct any prohibited transactions); and 

to comply with the standards of 

prudence and loyalty set forth in ERISA 

section 404 with respect to each such 

ERISA-covered plan and IRA to the 

extent that ERISA section 404 is 

applicable; 

(2) To indemnify and hold harmless 

the Covered Plan for any actual losses 

resulting directly from a CS Affiliated 

QPAM’s violation of ERISA’s fiduciary 

duties, as applicable, and of the 

prohibited transaction provisions of 

ERISA and the Code, as applicable; a 

breach of contract by a CS Affiliated 

QPAM; or any claim arising out of the 

failure of such CS Affiliated QPAM to 

qualify for the exemptive relief provided 

by PTE 84–14 as a result of a violation 

of Section I(g) of PTE 84–14 other than 

the CSAG Conviction. This condition 

applies only to actual losses caused by 

the CS Affiliated QPAM’s violations; 

(3) Not to require (or otherwise cause) 

the Covered Plan to waive, limit, or 

qualify the liability of the CS Affiliated 

QPAM for violating ERISA or the Code 

for engaging in prohibited transactions; 

(4) Not to restrict the ability of the 

Covered Plan to terminate or withdraw 

from its arrangement with the CS 

Affiliated QPAM, with respect to any 

investment in a separately-managed 

account or pooled fund subject to ERISA 

and managed by such CS Affiliated 

QPAM, with the exception of reasonable 

restrictions, appropriately disclosed in 

advance, that are specifically designed 

to ensure equitable treatment of all 

investors in a pooled fund in the event 

such withdrawal or termination may 

have adverse consequences for all other 

investors. In connection with any such 

arrangement involving investments in 

pooled funds subject to ERISA entered 

into after the effective date of this 

exemption, the adverse consequences 

must relate to a lack of liquidity of the 

underlying assets, valuation issues, or 

regulatory reasons that prevent the fund 

from promptly redeeming an ERISAcovered plan’s or IRA’s investment, and 

such restrictions must be applicable to 

all such investors and be effective no 

longer than reasonably necessary to 

avoid the adverse consequences; 

(5) Not to impose any fees, penalties, 

or charges for such termination or 

withdrawal with the exception of 

reasonable fees, appropriately disclosed 

in advance, that are specifically 

designed to prevent generallyrecognized abusive investment practices 

or specifically designed to ensure 

equitable treatment of all investors in a 

pooled fund in the event such 

withdrawal or termination may have 

adverse consequences for all other 

investors, provided that such fees are 

applied consistently and in a like 

manner to all such investors; 

(6) Not to include exculpatory 

provisions disclaiming or otherwise 

limiting liability of the CS Affiliated 

QPAMs for a violation of such 

agreement’s terms. To the extent 

consistent with ERISA section 410, 

however, this provision does not 

prohibit disclaimers for liability caused 

by an error, misrepresentation, or 

misconduct of a plan fiduciary or other 

party hired by the plan fiduciary who is 

independent of CSAG and its affiliates, 

or damages arising from acts outside the 

control of the CS Affiliated QPAM; and 

(7) Within 120 days after the effective 

date of this one-year exemption, each 

CS Affiliated QPAM must provide a 

notice of its obligations under this 

Section III(j) to each Covered Plan. For 

prospective Covered Plans that enter 

into a written asset or investment 

management agreement with a CS 

Affiliated QPAM on or after a date that 

is 120 days after the effective date of 

this exemption, the CS Affiliated QPAM 

must agree to its obligations under this 

Section III(j) in an updated investment 

management agreement between the CS 

Affiliated QPAM and such clients or 

other written contractual agreement. 

Notwithstanding the above, a CS 

Affiliated QPAM will not violate the 

condition solely because a Covered Plan 

refuses to sign an updated investment 

management agreement. For new 

Covered Plans that were provided an 

investment management agreement 

prior to the effective date of this 

exemption, returning it within 120 days 

after the effective date of this 

exemption, and that signed investment 

management agreement requires 

amendment to meet the terms of the 

exemption, the CS Affiliated QPAM 

may provide the new Covered Plan with 

amendments that need not be signed 

with any documents required by this 

subsection (j) within ten (10) business 

days after receipt of the signed 

agreement. This condition will be 

deemed met for each Covered Plan that 

received a notice pursuant to PTE 2019– 

07 that meets the terms of this 

condition. 

(k) Within 60 days after the effective 

date of this one-year exemption, each 

CS Affiliated QPAM provides notice of 

the exemption as published in the 

Federal Register, along with a summary 

describing the facts that led to the 

Convictions (the Summary), which has 

been submitted to the Department, and 

a prominently displayed statement (the 

Statement) that the Convictions result in 

a failure to meet a condition in PTE 84– 

14 and the CSSEL Conviction results in 

a failure to meet a condition in PTE 

2019–07, to each sponsor and beneficial 

owner of a Covered Plan that has 

entered into a written asset or 

investment management agreement with 

a CS Affiliated QPAM, or the sponsor of 

an investment fund in any case where 

a CS Affiliated QPAM acts as a subadviser to the investment fund in which 

such ERISA-covered plan and IRA 

invests. All prospective Covered Plan 

clients that enter into a written asset or 

investment management agreement with 

a CS Affiliated QPAM after a date that 

is 60 days after the effective date of this 


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20 If the Applicant meets this disclosure 

requirement through Summary Policies, changes to 

the Policies shall not result in the requirement for 

Continued 

exemption must receive a copy of the 

notice of the exemption, the Summary, 

and the Statement before, or 

contemporaneously with, the Covered 

Plan’s receipt of a written asset or 

investment management agreement from 

the CS Affiliated QPAM. The notices 

may be delivered electronically 

(including by an email that has a link to 

the one-year exemption). 

(l) The CS Affiliated QPAM must 

comply with each condition of PTE 84– 

14, as amended, with the sole exception 

of the violation of Section I(g) of PTE 

84–14 that is attributable to the 

Convictions. If, during the Exemption 

Period, an entity within the Credit 

Suisse corporate structure is convicted 

of a crime described in Section I(g) of 

PTE 84–14 (other than the Convictions), 

relief in this exemption would terminate 

immediately; 

(m)(1) Within 60 days after the 

effective date of this exemption, each CS 

Affiliated QPAM must designate a 

senior compliance officer (the 

Compliance Officer) who will be 

responsible for compliance with the 

Policies and Training requirements 

described herein. For purposes of this 

condition (m), each relevant line of 

business within a CS Affiliated QPAM 

may designate its own Compliance 

Officer(s). Notwithstanding the above, 

no person, including any person 

referenced in the CSAG or CSSEL 

Statement of Facts that gave rise to the 

CSAG or CSSEL Plea Agreement, who 

knew of, or should have known of, or 

participated in, any misconduct 

described in the CSAG or CSSEL 

Statement of Facts, by any party, may be 

involved with the designation or 

responsibilities required by this 

condition, unless the person took active 

documented steps to stop the 

misconduct. The Compliance Officer 

must conduct a review of each twelvemonth period of the Exemption Period 

(the Exemption Review), to determine 

the adequacy and effectiveness of the 

implementation of the Policies and 

Training. With respect to the 

Compliance Officer, the following 

conditions must be met: 

(i) The Compliance Officer must be a 

professional who has extensive 

experience with, and knowledge of, the 

regulation of financial services and 

products, including under ERISA and 

the Code; and 

(ii) The Compliance Officer must have 

a direct reporting line to the highestranking corporate officer in charge of 

compliance for the applicable CS 

Affiliated QPAM. 

(2) With respect to the Exemption 

Review, the following conditions must 

be met: 

(i) The Annual Exemption Review 

includes a review of the CS Affiliated 

QPAM’s compliance with and 

effectiveness of the Policies and 

Training and of the following: Any 

compliance matter related to the 

Policies or Training that was identified 

by, or reported to, the Compliance 

Officer or others within the compliance 

and risk control function (or its 

equivalent) during the previous year; 

the most recent Audit Report issued 

pursuant to this exemption or PTE 

2019–07; any material change in the 

relevant business activities of the CS 

Affiliated QPAMs; and any change to 

ERISA, the Code, or regulations related 

to fiduciary duties and the prohibited 

transaction provisions that may be 

applicable to the activities of the CS 

Affiliated QPAMs; 

(ii) The Compliance Officer prepares 

a written report for the Exemption 

Review (an Exemption Report) that (A) 

summarizes his or her material activities 

during the prior year; (B) sets forth any 

instance of noncompliance discovered 

during the prior year, and any related 

corrective action; (C) details any change 

to the Policies or Training to guard 

against any similar instance of 

noncompliance occurring again; and (D) 

makes recommendations, as necessary, 

for additional training, procedures, 

monitoring, or additional and/or 

changed processes or systems, and 

management’s actions on such 

recommendations; 

(iii) In the Exemption Report, the 

Compliance Officer must certify in 

writing that to the best of his or her 

knowledge at the time: (A) The report is 

accurate; (B) the Policies and Training 

are working in a manner which is 

reasonably designed to ensure that the 

Policies and Training requirements 

described herein are met; (C) any known 

instance of noncompliance during the 

prior year and any related correction 

taken to date have been identified in the 

Exemption Report; and (D) the CS 

Affiliated QPAMs have complied with 

the Policies and Training, and/or 

corrected (or are correcting) any known 

instances of noncompliance in 

accordance with Section III(h) above; 

(iv) The Exemption Report must be 

provided to appropriate corporate 

officers of CSAG and to each CS 

Affiliated QPAM to which such report 

relates, and to the head of compliance 

and the general counsel (or their 

functional equivalent) of CSAG and the 

relevant CS Affiliated QPAM; and the 

report must be made unconditionally 

available to the independent auditor 

described in Section III(i) above; 

(v) The Exemption Review, including 

the Compliance Officer’s written 

Annual Exemption Report, must cover 

the twelve-month period beginning on 

November 21, 2021. The Annual 

Review, including the Compliance 

Officer’s written Report, must be 

completed within three (3) months 

following the end of the period to which 

it relates; 

(n) CSAG imposes its internal 

procedures, controls, and protocols on 

CSAG and CSSEL to reduce the 

likelihood of any recurrence of conduct 

that is the subject of the Convictions; 

(o) Relief in this exemption will 

terminate on the date that is six months 

following the date that a U.S. regulatory 

authority makes a final decision that 

CSAG failed to comply in all material 

respects with any requirement imposed 

by such regulatory authority in 

connection with the Convictions; 

(p) Each CS Affiliated QPAM will 

maintain records necessary to 

demonstrate that the conditions of this 

exemption have been met for six (6) 

years following the date of any 

transaction for which the CS Affiliated 

QPAM relies upon the relief in this 

exemption; 

(q) During the Exemption Period, 

CSAG must: (1) Immediately disclose to 

the Department any Deferred 

Prosecution Agreement (a DPA) or NonProsecution Agreement (an NPA) with 

the U.S. Department of Justice, entered 

into by Credit Suisse Group AG or 

CSAG or any of its affiliates (as defined 

in Section VI(d) of PTE 84–14) in 

connection with conduct described in 

Section I(g) of PTE 84–14 or section 411 

of ERISA; and (2) immediately provide 

the Department with any information 

requested by the Department, as 

permitted by law, regarding the 

agreement and/or conduct and 

allegations that led to the agreement; 

(r) Within 60 days after the effective 

date of this exemption, each CS 

Affiliated QPAM, in its agreements 

with, or in other written disclosures 

provided to Covered Plans, will clearly 

and prominently inform Covered Plan 

clients of their right to obtain a copy of 

the Policies or a description (Summary 

Policies) which accurately summarizes 

key components of the CS Affiliated 

QPAM’s written Policies developed in 

connection with this exemption. If the 

Policies are thereafter changed, each 

Covered Plan client must receive a new 

disclosure within six (6) months 

following the end of the calendar year 

during which the Policies were 

changed.20 With respect to this 


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23264 Federal Register / Vol. 87, No. 75 / Tuesday, April 19, 2022 / Notices 

a new disclosure unless, as a result of changes to the Policies, the Summary Policies are no longer 

accurate. 

requirement, the description may be 

continuously maintained on a website, 

provided that such website link to the 

Policies or Summary Policies is clearly 

and prominently disclosed to each 

Covered Plan; 

(s) A CS Affiliated QPAM will not fail 

to meet the terms of this one-year 

exemption solely because a different CS 

Affiliated QPAM fails to satisfy a 

condition for relief described in Section 

III(c), (d), (h), (i), (j), (k), (l), (p) or (r); 

or if the independent auditor described 

in Section III(i) fails to comply with a 

provision of the exemption other than 

the requirement described in Section 

III(i)(11), provided that such failure did 

not result from any actions or inactions 

of CSAG or its affiliates; and 

(t) All the material facts and 

representations set forth in the 

Summary of Facts and Representations 

are true and accurate. 

Effective Date: This exemption will be 

in effect for one (1) year, beginning on 

the date of the CSSEL Conviction. 

Signed at Washington, DC. 

Timothy P. Hauser, 

Deputy Assistant Secretary for Program 

Operations, Employee Benefits Security 

Administration, U.S. Department of Labor. 

[FR Doc. 2022–08306 Filed 4–18–22; 8:45 am] 

BILLING CODE 4510–29–P 

DEPARTMENT OF LABOR 

Employment and Training 

Administration 

Determinations Regarding Eligibility 

To Apply for Trade Adjustment 

Assistance 

In accordance with Sections 223 and 

284 (19 U.S.C. 2273 and 2395) of the 

Trade Act of 1974 (19 U.S.C. 2271, et 

seq.) (‘‘Act’’), as amended, the 

Department of Labor herein presents 

summaries of determinations regarding 

eligibility to apply for trade adjustment 

assistance under Chapter 2 of the Act 

(‘‘TAA’’) for workers by (TA–W) issued 

during the period of March 1, 2022 

through March 31, 2022. 

This notice includes summaries of 

initial determinations such as 

Affirmative Determinations of 

Eligibility, Negative Determinations of 

Eligibility, and Determinations 

Terminating Investigations of Eligibility 

within the period. If issued in the 

period, this notice also includes 

summaries of post-initial 

determinations that modify or amend 

initial determinations such as 

Affirmative Determinations Regarding 

Applications for Reconsideration, 

Negative Determinations Regarding 

Applications for Reconsideration, 

Revised Certifications of Eligibility, 

Revised Determinations on 

Reconsideration, Negative 

Determinations on Reconsideration, 

Termination Determinations on 

Reconsiderations, Revised 

Determinations on Remand, and 

Negative Determinations on Remand. 

Affirmative Determinations for Trade 

Adjustment Assistance 

The following certifications have been 

issued. 

TA–W–No. Subject firm Location Reason(s) 

96,825 .......... Geater Machining & Manufacturing, Co.Independence, IA ............ Secondary Component Supplier. 

96,876 .......... TD Bank, N.A ............................. Mount Laurel, NJ ............. Shift in Services to a Foreign Country. 

96,876A ........ TD Bank, N.A ............................. Mount Laurel, NJ ............. Shift in Services to a Foreign Country. 

96,876B ........ TD Bank, N.A ............................. Mount Laurel, NJ ............. Shift in Services to a Foreign Country. 

96,965 .......... ON Semiconductor ..................... Gresham, OR .................. Shift in Production to a Foreign Country. 

97,051 .......... Hess Corporation ....................... Minot, ND ........................ Customer Imports of Articles. 

97,064 .......... Never Again Industries LLC ....... Chesapeake, VA ............. Imports of Finished Articles Containing Like or Directly Competitive Components. 

97,108 .......... Gannett Co., Inc ......................... McLean, VA ..................... Shift in Services to a Foreign Country.

98,042 .......... FCA US LLC, Belvidere Assembly Plant.Belvidere, IL .................... Increased Company Imports. 

98,070 .......... eSchool Data ............................. Bohemia, NY ................... Actual/Likely Increase in Imports following a Shift Abroad. 

98,096 .......... Evergreen Packaging LLC ......... Pine Bluff, AR .................. Increased Customer Imports. 

98,129 .......... Plexus Corp ............................... Nampa, ID ....................... Shift in Production to an FTA Country or Beneficiary. 

98,136 .......... Tenneco Inc ............................... Kettering, OH ................... Shift in Production to an FTA Country or Beneficiary. 

98,158 .......... The Hain Celestial Group, Inc ... Ashland, OR .................... Increased Customer Imports. 

98,158A ........ The Hain Celestial Group, Inc ... Ashland, OR .................... Increased Customer Imports. 

98,163 .......... Hexcel Corporation .................... Kent, WA ......................... Upstream Supplier. 

98,165 .......... Safariland, LLC .......................... Ontario, CA ...................... Shift in Production to an FTA Country or Beneficiary. 

98,167 .......... Dekko, ECA (Electri-Cable Assemblies) Division.Shelton, CT ..................... Shift in Production to an FTA Country or Beneficiary. 

98,168 .......... The Hain Celestial Group, Inc ... Lake Success, NY ........... Increased Customer Imports. 

98,182 .......... Electrolux Home Products, Inc .. Memphis, TN ................... Shift in Production to an FTA Country or Beneficiary. 

98,189 .......... Legendary Headwear, LLC ........ San Diego, CA ................ Shift in Production to an FTA Country or Beneficiary. 

98,190 .......... FormFactor, Inc .......................... Beaverton, OR ................. Actual/Likely Increase in Imports following a Shift Abroad. 

98,203 .......... East West Manufacturing ........... El Paso, TX ..................... Shift in Production to an FTA Country or Beneficiary. 

98,219 .......... BCS Automotive Interface Solutions LLC.Galesville, WI .................. Shift in Production to an FTA Country or Beneficiary. 

98,229 .......... Permasteelisa North America .... Windsor, CT .................... Shift in Production to an FTA Country or Beneficiary. 


lotter on DSK11XQN23PROD with NOTICES1