April 5 (Bloomberg) -- Kareem Serageldin, the ex-global head of Credit Suisse Group AG’s structured credit trading business, will be arraigned today for an alleged 2007 scheme to mark up the value of debt securities to meet targets and boost year-end bonuses for his $5.35 billion trading book.
Serageldin, a U.S. citizen who lives in England, will be formally charged before U.S. Magistrate Judge Kevin Fox in Manhattan, a court clerk said. A lawyer for Serageldin told a London court in November that his client was close to reaching a plea deal with prosecutors that would include his voluntary return to the U.S.
Last year, two of Serageldin’s former subordinates, David Higgs and Salmaan Siddiqui, pleaded guilty to overstating the value of mortgage-backed assets in a Credit Suisse trading book known as ABN1 after the collapse of the U.S. housing market. Both said they acted at Serageldin’s direction and agreed to cooperate with prosecutors.
Credit Suisse fired all three employees in 2008. Serageldin was charged with conspiracy, falsification of books and records and wire fraud. He was arrested outside the U.S. consulate in London in September.
Michael Kim, a lawyer for Serageldin, didn’t immediately return a phone message seeking comment on the scheduled arraignment. Victoria Harmon, a spokeswoman for Zurich-based Credit Suisse, declined to comment.
The U.S. criminal cases are U.S. v. Higgs, 12-cr-00088, and U.S. v. Siddiqui, 12-cr-00089, U.S. District Court, Southern District of New York (Manhattan). The SEC case is U.S. Securities and Exchange Commission v. Serageldin, 12-cv-00796, U.S. District Court, Southern District of New York (Manhattan).
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