Credit Suisse trader bailed on £1.8bn fraud charges

The former senior Credit Suisse trader who was this week arrested in London on fraud charges was granted bail in court yesterday, with his lawyer saying he would fight plans for his extradition to the US.

Kareem Serageldin, former global head of structure credit trading for the Swiss bank, is wanted in the US on fraud charges involving subprime mortgage bonds worth $3bn (£1.8bn). At a hearing at Westminster magistrates' court, the former banker was granted bail set at £150,000 – £100,000 in cash and a £50,000 surety.

Mr Serageldin was told after he refused to consent to extradition that a further hearing will take place on 28 November. He will be required to wear an electronic tag while on bail.

Mr Serageldin is the most senior executive to be charged in a scandal going back to 2007, in which prosecutors claim mortgage-backed securities traders were caught trying to cover up $540m in losses on their books.

The Egyptian-born former banker was arrested outside the US Embassy in London on Wednesday after US officials filed criminal charges against him relating to inflating mortgage-bond values during the 2008 financial crisis. US prosecutors had been waiting for almost eight months for Mr Serageldin, who is 39, to return to the country to face charges.

In February, two of his ex-colleagues pleaded guilty to charges of wire fraud and falsifying books and records, and admitted to having acted to cover up losses on Mr Serageldin's orders. His lawyer, Ben Brandon, told Judge Michael Snow yesterday that his client had been in talks to settle fraud charges he faces in the US at the time the Metropolitan Police arrested him this week. He claimed the former banker had made attempts going back three years to resolve the US charges with officials including the US Department of Justice and the US Securities and Exchange Commission.

Mr Brandon said his client believed he was within striking distance of arranging a settlement with US officials that would have seen criminal charges capped at a prison term of five years. He added that Mr Serageldin, who has dual UK and US nationality, had also been requesting a prisoner-transfer agreement that would see him serve his prison time in the UK. The alleged fraudster thought he was attending another set of talks with US Embassy officials when he was arrested, his lawyer said.

In February, two former Credit Suisse employees pleaded guilty in the US Federal court to wire fraud and falsifying books and records. They admitted to having acted to cover up losses at Mr Serageldin's direction.