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BNP Paribas to pay $9bn to settle sanctions violations | BNP Paribas to pay $9bn to settle sanctions violations |
(35 minutes later) | |
France's largest bank BNP Paribas has agreed to a record $9bn (£5.1bn) settlement with US prosecutors over allegations of sanctions violations. | France's largest bank BNP Paribas has agreed to a record $9bn (£5.1bn) settlement with US prosecutors over allegations of sanctions violations. |
As part of the deal, the bank will plead guilty to two criminal charges of breaking US sanctions against trade with Sudan, Iran and Cuba. | As part of the deal, the bank will plead guilty to two criminal charges of breaking US sanctions against trade with Sudan, Iran and Cuba. |
It will also be prevented from clearing certain transactions in US dollars for one year from the start of 2015. | It will also be prevented from clearing certain transactions in US dollars for one year from the start of 2015. |
The settlement is the largest for such a case in US history. | The settlement is the largest for such a case in US history. |
"Between 2004 and 2012, BNP engaged in a complex and pervasive scheme to illegally move billions through the US financial system," said US Attorney General Eric Holder in a press conference. | "Between 2004 and 2012, BNP engaged in a complex and pervasive scheme to illegally move billions through the US financial system," said US Attorney General Eric Holder in a press conference. |
In doing so, the bank "deliberately and repeatedly violated longstanding US sanctions", he said. | In doing so, the bank "deliberately and repeatedly violated longstanding US sanctions", he said. |
Mr Holder added that he hoped the settlement would serve as a warning to other firms that did business with the US that "illegal conduct will simply not be tolerated". | |
As part of its agreement with US authorities, BNP agreed to fire and not re-hire 13 individuals who were associated with the sanctions violations. | As part of its agreement with US authorities, BNP agreed to fire and not re-hire 13 individuals who were associated with the sanctions violations. |
'Unfair decision' | 'Unfair decision' |
France has been pressing the US over the size of the fine, which would almost wipe out BNP's entire 2013 pre-tax income of about 8.2bn euros (£6.7bn, $11.2bn). | France has been pressing the US over the size of the fine, which would almost wipe out BNP's entire 2013 pre-tax income of about 8.2bn euros (£6.7bn, $11.2bn). |
French Foreign Minister Laurent Fabius has previously said a fine of the size suggested would be "an extremely serious problem", an "unfair and unilateral decision" and "not reasonable". | French Foreign Minister Laurent Fabius has previously said a fine of the size suggested would be "an extremely serious problem", an "unfair and unilateral decision" and "not reasonable". |
In April, BNP Paribas said it had set aside $1.1bn to cover the cost of US penalties, but that the "amount of the fines could be far in excess of the amount of the provision". | In April, BNP Paribas said it had set aside $1.1bn to cover the cost of US penalties, but that the "amount of the fines could be far in excess of the amount of the provision". |
The settlement amount surpasses oil giant BP's $4bn agreement with the US Department of Justice in 2012. | The settlement amount surpasses oil giant BP's $4bn agreement with the US Department of Justice in 2012. |
US regulators have recently stepped up their actions against banks that violate laws against money laundering and tax evasion, amongst other violations. | US regulators have recently stepped up their actions against banks that violate laws against money laundering and tax evasion, amongst other violations. |
Earlier in May, Swiss bank Credit Suisse agreed to a $2.6bn penalty and admitted criminal wrongdoing in helping "tax cheats" avoid paying US taxes. | Earlier in May, Swiss bank Credit Suisse agreed to a $2.6bn penalty and admitted criminal wrongdoing in helping "tax cheats" avoid paying US taxes. |
And in 2012, UK-based bank Standard Chartered paid a total of $674m (£419m) to US regulators and authorities for illegally hiding transactions with Iran and other countries under US sanctions. | And in 2012, UK-based bank Standard Chartered paid a total of $674m (£419m) to US regulators and authorities for illegally hiding transactions with Iran and other countries under US sanctions. |
To date, the largest fine levied against a bank by US regulators for sanctions violations was the $1.9bn HSBC paid in 2012. | To date, the largest fine levied against a bank by US regulators for sanctions violations was the $1.9bn HSBC paid in 2012. |