The Federal Reserve has officially ended its enforcement action against UBS Group AG related to the 2021 collapse of Archegos Capital Management. This closure marks a significant regulatory milestone for UBS, which inherited the enforcement issues after acquiring Credit Suisse in an emergency deal in 2023. The termination took effect on May 12, 2026, nearly three years after the Federal Reserve imposed penalties and a cease-and-desist order for weaknesses in counterparty credit-risk management and governance controls.
The regulatory scrutiny began when Archegos Capital Management collapsed in March 2021 due to heavily leveraged trading positions that rapidly lost value. Credit Suisse suffered losses estimated at $5.5 billion connected to Archegos and admitted to serious deficiencies in risk governance and control systems within its prime services division. Following this, the Swiss regulator FINMA launched enforcement proceedings against Credit Suisse, while U.S. regulators, including the Federal Reserve, investigated the bank’s risk management practices.
Regulators found that Credit Suisse failed to properly manage liquidity, governance, data management, and stress-testing procedures related to Archegos despite repeated warning signs. When UBS acquired Credit Suisse, it assumed responsibility for these regulatory matters. In July 2023, the Federal Reserve issued a consent order against both UBS and Credit Suisse entities tied to the Archegos collapse. As part of this enforcement action, the banks agreed to pay approximately $268.5 million in civil penalties for unsafe counterparty credit-risk management practices. This action was coordinated with FINMA and the Bank of England’s Prudential Regulation Authority, with total penalties reaching around $387 million.
Since then, UBS has worked diligently to integrate Credit Suisse’s operations and strengthen risk management and governance frameworks across the combined company. The Fed’s decision to end the enforcement action signals progress in UBS’s remediation efforts and removes a significant regulatory burden that could support its long-term profitability and operational efficiency.
UBS still faces other legal challenges from Credit Suisse’s legacy issues. In 2025, the Swiss Federal Administrative Court overturned FINMA’s decision requiring a write-off of Credit Suisse’s Additional Tier 1 bonds, though this ruling is under appeal. Additionally, UBS paid nearly $987 million to settle a French tax case, $511 million to resolve a U.S. Department of Justice tax probe, and $300 million to settle Credit Suisse’s legacy residential mortgage-backed securities matter with the DOJ.
Other major banks have also seen progress with their regulatory challenges. Last month, Goldman Sachs cleared an enforcement action related to its foreign exchange trading after paying a fine imposed in 2018 for unsafe practices. Similarly, Wells Fargo completed its requirements under a 2018 Federal Reserve order linked to its fake-account scandal, marking another important regulatory milestone.
These developments show continued efforts by major financial institutions to address past regulatory shortcomings and improve governance standards under close scrutiny from regulators like the Federal Reserve. The closure of these enforcement actions helps restore market confidence and allows banks like UBS to focus on growth without the weight of ongoing regulatory penalties.
