September 26, 2012 / 8:16 PM / 5 years ago

Former Credit Suisse trader arrested in London in trading scandal

NEW YORK, Sept 26 (Reuters) - London’s Metropolitan Police arrested a former Credit Suisse trader on Wednesday in connection with a scandal dating back to 2007 in which mortgage-backed securities traders were caught trying to cover up losses on their books, a source familiar with the matter told Reuters.

The former employee, Kareem Serageldin, was the last remaining person allegedly involved in the scandal to face charges. Two other employees pleaded guilty in U.S. federal court earlier this year to criminal fraud charges.

U.S. prosecutors said traders in New York and London for Credit Suisse Group AG hid $540 million of losses, according to charges filed in the case.

Prosecutors earlier this year indicted Serageldin, a U.S. citizen, at the same time as the other traders, but he remained in London.

A spokeswoman for Serageldin’s lawyer, Sean Casey of Kobre & Kim in New York, declined to comment.

The source said that Serageldin, who supervised the other traders in the case, was expected to appear before a British court on Thursday to face extradition proceedings. There are no other arrests expected in the case.

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