By Heather Grossmann
DNAinfo Reporter/Producer
MUNICIPAL DISTRICT — Manhattan District Attorney Robert Morgenthau scored $536 million in a Wednesday settlement with disgraced investment bank Credit Suisse, but interference by Mayor Bloomberg cost the city more than $25 million in settlement funds.
Bloomberg recently went head-to-head with Morgenthau, demanding that the D.A.’s office turn over 100 percent of any large prosecutorial settlements or fees to the city, instead of maintaining the usual 60-40 split with the state.
The mayor lost the battle, and the city ended up being forced to cede a 50-50 split of future spoils with Albany. That amounts to just a quarter of Credit Suisse's total settlement money — since half of the sum goes directly to the U.S. government, Attorney General Eric Holder told reporters Wednesday.
Bloomberg stuck his foot in his mouth earlier this month, while also accusing Morgenthau for keeping secret accounts full of prosecutors' settlement cash.
Morgenthau adamantly denied the charges, calling Bloomberg "chickens---t" for raising the issue.
Credit Suisse was charged with falsifying business records so that its offices in Iran, Libya and Sudan could sidestep government sanctions to do business with the U.S. They admitted to to the crimes in exchange for a deferred prosecution and a $536 million fine, District Attorney Morgenthau said.
The bank admitted to moving hundred of millions of dollars through Manhattan between the mid-1990s through 2006 on behalf of clients barred from doing business here, prosecutors said.
"This case shows what happens when a prominent bank ignores sanctions and moves money for a dangerous and repressive regime,” Morgenthau said in a statement.
“Banks should know that if you violate sanctions and deal with Iran, you’re going to pay a severe penalty.”
The D.A. highlighted the particular importance of the case given Iran’s alleged pursuit of nuclear arms and its human rights violations.
Shayna Jacobs contributed reporting.
