Credit Suisse suffered the embarrassment of being hit by penalties totalling almost £6 million from regulators on opposite sides of the Atlantic after the Swiss bank’s systems failed in London and New York.

The Financial Services Authority (FSA) fined Credit Suisse £5.6 million for allowing traders in its fixed income business to falsify the value of complex assets for five months. The New York Stock Exchange (NYSE) levied a $350,000 (£190,000) fine against Credit Suisse for a technical mishap that caused the bank to trade ahead of clients’ orders in breach of stock market rules.

Referring to the FSA fine, Brady Dougan, Credit Suisse’s chief executive, said that the incident did not represent the high ethical standards of the bank. “We’ve taken actions to implement a remediation programme to address the findings of our internal review,” he said.

The fine is the fourth largest levied by the UK regulator, and comes after a £4 million fine paid by Credit Suisse in 2002 for attempting to mislead the Japanese regulatory and tax authorities.

A former FSA lawyer said that the regulator was almost certain to take action against the individual traders involved in the UK case. Chris Brennan, a partner in Barlow Lyde & Gilbert, said: “Given the serious nature of the misconduct and the FSA’s recent proclamations that it plans to call more individuals to account, it wouldn’t be surprising if the regulator decides to bring [further] enforcement action”.

The FSA declined to comment on whether it was investigating what have been described as a handful of traders in London, New York and other locations. Any findings would be shared with US regulators, lawyers said.

Credit Suisse revealed on February 19, just days after announcing its 2007 full-year figures, that it had uncovered a fraud by traders in its structured credit group (SCG) and would be forced to cut the value of its assets by $2.6 billion. Almost $1.7 billion of write-down related to the traders’ activities in London.

The traders had misreported the value of assets such as collateralised debt obligations. Although concerns were first raised within Credit Suisse last August over SCG’s pricing, the bank did not conclude its own investigation until after it had released its 2007 results.

A report by the bank found that its traders were challenged at least three times between August and December by Credit Suisse staff over pricing discrepancies but this was dismissed by the traders, who also ignored requests to alter their marking methods. The FSA said that the bank’s controls were inconsistent and ineffective, and that its fine would have been £8 million if Credit Suisse had not settled early.

The NYSE yesterday accused the bank of trading ahead of clients’ orders and alongside clients without permission on four occasions. The misdemeanour was picked up by the exchange’s trading surveillance team.

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