Credit Suisse Securities (USA) has agreed to settle charges pressed by the Securities and Exchange Commission and the Office of the New York Attorney General regarding its handling of certain customers' orders.

The settlements require Credit Suisse to pay $5 million to the SEC and $5 million to the NYAG. They concern a business that the bank no longer runs called Retail Execution Services or RES.

According to the SEC’s order, Credit Suisse created the RES desk to execute orders for other broker-dealers that handle order flow on behalf of HNW investors. The SEC says that although RES promoted its access to dark-pool liquidity to customers, it executed an exceedingly minimal number of held orders – orders that must be executed immediately at the current market price – in dark pools between September 2011 and December 2012.

The SEC’s order also finds that although Credit Suisse said that it could provide 'robust' and 'enhanced' improvements in (i.e. lower) order prices, RES’s computer code treated orders for which execution quality is required to be publicly reported differently from orders for which execution quality is not publicly reported. Between mid-2011 and March 2015, the SEC believes that Credit Suisse did not lower prices for RES retail customers on their non-reportable orders, and that it failed to tell them about this. For these non-reportable orders, it is claimed, RES disproportionately used a routing tactic that generally affected the market and resulted in less favorable execution prices for customers, claiming all the while to be of benefit to them. This routing tactic "provided RES with an opportunity to profit from its execution of the final portions of those customer orders internally."

Market makers that handle retail orders are obliged to be open with their customers about the execution of orders and the ways in which they might profit from theose customers’ trades. The SEC says that Credit Suisse negligently contravened s17(a)(2) Securities Act. Credit Suisse has admitted nothing.