ZURICH, Sept 23 (Reuters) - Zurich prosecutors have opened a criminal investigation into an incident last week in which private detectives allegedly shadowed ex-Credit Suisse banker Iqbal Khan and his wife, the district attorney’s office said on Monday
Khan, due to take up leadership of UBS’s wealth management unit next month just three months after leaving Credit Suisse, filed a criminal complaint alleging threats and coercion in the Sept. 17 confrontation.
Swiss newspaper SonntagsZeitung, without citing its sources, reported that Credit Suisse had hired three detectives to investigate whether Khan was seeking to lure its employees to UBS.
The situation escalated when one of the men sought to take Khan’s phone after he tried to take a photograph of the detectives’ car, the newspaper reported.
“As a result of a criminal complaint (by Khan)...the Zurich District Attorney has opened a criminal investigation into coercion/threat,” a prosecutors office spokesman said in an email. “We cannot give further details because this is an ongoing investigation.”
Credit Suisse did not respond to questions from Reuters.
Khan, via a spokesman, denied trying to poach Credit Suisse workers for his new employer.
“Suspicions that he was trying to hire people away from Credit Suisse are absurd,” the spokesman said on Monday.
Khan is a rising star in Swiss finance, the son of Pakistani immigrants who came to Switzerland when he was just 12 and who grew up in the Zurich suburbs to become one of the nation’s top bankers.
He has been mooted as a candidate to eventually lead one of the country’s big banks, including Sergio Ermotti-led UBS.
Swiss media, including financial industry website Inside Paradeplatz, reported that the incident last week began when the 43-year-old Khan and his wife were tailed in their automobile by another vehicle.
Near the Swiss National Bank building in the heart of Zurich’s financial district, Khan stepped from his car and attempted to photograph the other vehicle with his cell phone.
The occupants fled after passers-by noticed the altercation, the SonntagsZeitung reported, adding the three men were eventually located and detained for questioning.
Financial institutions including in Switzerland are covetous of their client-employee relationships, and sometimes place employees or ex-employees under intense scrutiny to ensure they do not violate non-compete clauses or other contractual obligations.
“Mostly, such practices never meet the light of day,” Swiss reputation consultant Bernhard Bauhofer told Swiss tabloid Blick.
Still, other experts said the tactics described in Khan’s situation were “mafia methods” that had no place in the industry. “I can’t remember anything similar in my long career,” former UBS and Credit Suisse CEO Oswald Gruebel told the newspaper.
Khan announced his resignation from Credit Suisse in July “to pursue other opportunities”.
In late August, Credit Suisse’s arch rival UBS said Khan would co-head its flagship wealth management business starting on Oct. 1 as part of a broader shake-up of its executive board.
UBS declined comment on the incident involving its new employee, as did Swiss financial system supervisor FINMA. (Writing by John Miller, reporting by Angelika Gruber and Oliver Hirt, editing by Louise Heavens)