Banking Law

BNP Paribas will pay nearly $9B, a record fine for violating US sanctions

BNP Paribas, France’s largest bank, has agreed to pay nearly $9 billion as part of a guilty plea to charges that it concealed transactions with countries sanctioned by the United States.

The settlement is the largest amount paid for violations of U.S. sanctions and the largest penalty paid by a bank in a criminal case, Legal Times reports. The Wall Street Journal (sub. req.), the Washington Post and the New York Times Dealbook blog also have reports.

The agreement also imposes a one-year ban on the bank’s “dollar clearing” activities, which involves converting payments on behalf of clients into U.S. dollars from a foreign currency, according to this explanation by the Wall Street Journal. The Washington Post says the suspension “is arguably more damaging than levying a big fine.”

On Monday, the bank pleaded guilty to New York state charges of conspiracy and filing false business records, the Wall Street Journal says. The bank will also plead guilty to a federal charge of conspiring to violate the International Emergency Economic Powers Act.

About half the fine will go to the federal government and about half will go to New York, the Washington Post says.

Attorney General Eric Holder said the deal sends a message to institutions that do business in the United States that illegal conduct will not be tolerated. U.S. Attorney Preet Bharara said the bank “perpetrated what was truly a tour de fraud.”

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