3 Credit Suisse traders charged with bond fraud

David Higgs, one of the accused former traders at Credit Suisse, who pleaded guilty.

The New York Times:

The government charged three former Credit Suisse traders on Wednesday with inflating the value of mortgage bonds as the housing market collapsed, a rare criminal prosecution of Wall Street executives for their conduct during the financial crisis.

Federal prosecutors contend they deployed the scheme to increase their year-end bonuses.

The charges, involving traders in New York and London, come just a week after President Obama pledged in his State of the Union address to escalate investigations of banks and other financial firms and “help turn the page on an era of recklessness that hurt so many Americans.”

Two of the Credit Suisse traders, David Higgs and Salmaan Siddiqui, pleaded guilty to mismarking their positions to avoid losses at the end of 2007, just as the housing market was deteriorating. Both are cooperating with the investigation.

The third man charged, Kareem Serageldin, their boss, headed a group that traded mortgage-backed securities.

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