The Credit Suisse AG spy scandal was supposed to be a one-off incident, albeit an astonishing one. It turns out it wasn’t.

Worse, the Swiss bank is in the surreal situation of confirming that it now knows it tailed multiple people, but that its board and management were completely in the dark, and that Chief Executive Officer Tidjane Thiam definitely didn’t know. The top brass being unaware of this stuff happening on their watch doesn’t inspire confidence. 

Back in October, Credit Suisse explained that a seven-day surveillance operation on its former head of wealth management, Iqbal Khan, was an isolated incident kept hidden from most senior managers — including Thiam. An internal probe found the operation was the brainchild of Chief Operating Officer Pierre-Olivier Bouee, who used “disproportionate” methods to keep tabs on Khan after his defection to arch-rival UBS AG. Bouee and his security chief fell on their swords. They had gone too far in defending the bank’s interests, Thiam said.

A few months on, the scandal has blown up again. It turns out that the bank’s confidence about Khan being a one-off target was misplaced: Credit Suisse on Monday confirmed that Bouee had organized another surveillance operation in February, this time tracking Peter Goerke, then its head of human resources. Again, Bouee and his associates apparently kept the operation secret, using outside investigators, and another Credit Suisse probe found nobody else knew about it — including Thiam. Bouee’s already gone, but the bank says he’s now been fired for good measure.

Whatever investigations the bank has been conducting have clearly been based on some wildly optimistic premises about its ability to uncover the truth. The bank says the law firm running the probe was told to ask whether any other employees were tailed, but people have lied and covered their electronic tracks. More embarrassing for Credit Suisse, the Goerke revelation came from the media. The bank gave the impression of being on top of things in October; now it’s reduced to following newspaper reports.

As a result, the questions about the Swiss bank’s governance raised by the Khan surveillance — such as why an executive like Bouee would go after a former employee, and why they would think this is okay — are going to intensify.

Goerke is still with the bank, albeit in a different job, and was being observed on his day off. Why? Bouee’s behavior toward Khan, presented as a lone-wolf attempt to protect the bank’s interests in the hotly competitive world of wealth management, now looks more like the regular modus operandi. How did he have such power? And how did Thiam, who brought Bouee on board to stamp his own authority onto the bank, have no clue about any of it?

Credit Suisse has managed so far to keep Thiam and his turnaround strategy separate from the spying allegations. But this is an increasingly murky situation, and the bank has failed to draw a line under it. Swiss regulators are probing the revelations, and prosecutors have opened a criminal probe into Khan’s surveillance. Given the business challenges ahead for Thiam in an environment of negative rates, tough competition and disappointing profitability, this is all bad news for investors.

This opinion piece was provided by Bloomberg News.