Credit Suisse has instructed Clifford Chance on a major investigation by the Italian authorities over allegations of money laundering and tax evasion.

The Swiss bank could face penalties including fines or suspension of business in Italy if the allegations are proven.

News of the probe, run by prosecutors in Milan, surfaced in the Italian media last week. Reports said the claims relate to billions of euros of insurance policies sold to Italian clients and subsequently used to hide the funds from tax authorities.

Clifford Chance has been drafted in by both Credit Suisse AG and Credit Suisse Life & Pension on the criminal and tax aspects of the probe. Milan disputes and regulatory partner Antonio Golino is acting as criminal defence counsel, while tax partner Carlo Galli is advising on the tax dispute with the Italian revenue agency.

Credit Suisse has been the subject of a number of tax investigations in recent years, paying out $2.6bn in fines to US authorities in 2014 and €150m in Germany to settle court claims over allegations the bank helped clients evade taxes.

A statement from the bank said: “Credit Suisse’s business with private clients is systematically focused on declared assets and we have clear internal rules and processes in place to ensure that we conduct our business in accordance with the applicable laws in Italy.

“In connection with the [voluntary tax] disclosure program approved by the Italian government in December 2014, Credit Suisse immediately asked its clients to provide evidence that they are tax-compliant. This process has virtually been completed. We can’t comment on ongoing investigations.”

The Clifford Chance instruction is the latest in a trend of criminal and regulatory investigations mandates going to magic circle firms, which are hiring growing numbers of disputes lawyers with white-collar criminal law backgrounds.

Clifford Chance has recently been instructed to advise Pfizer on a Competition and Markets Authority investigation into allegations of anti-competitive pricing; the Conservative party investigation into claims of bullying in the party; and on an independent review into oil and gas company SOCO, which has been accused of bribery in the Democratic Republic of Congo.

Elsewhere, Freshfields Bruckhaus Deringer has been instructed by Tesco to advise on the ongoing Serious Fraud Office review into its accounting practices, while Slaughter and May has been drafted in by Rolls-Royce on allegations of bribery and corruption.

A raft of magic circle firms have also been instructed by UK and US banks to lead on regulatory probes into Libor and foreign exchange rate manipulation.