Banking Law

French bank reportedly cited legal memo by 'well-respected' US law firm in plea negotiation

Corrected: BNP Paribas had hoped an advice-of-counsel defense would help it fend off charges in a U.S. investigation into its business dealings with countries sanctioned by the United States.

The French bank showed prosecutors a legal memo drafted by a U.S. law firm around 2004 that said the bank could process certain transactions for Sudan, as long as its New York employees weren’t involved, the New York Times reports. The story relies on unnamed sources.

According to the Times, the sources said the memo was written by a “well-respected firm based in the United States.” Prosecutors reportedly determined, however, that the advice-of-counsel defense applies only to transactions over a short time period.

Prosecutors are said to be seeking a $10 billion penalty in plea negotiations, according to the Times and the Wall Street Journal (sub. req.). French President François Hollande has written to President Obama expressing his view that any penalty against the bank should not be “unfair and disproportionate,” according to a spokesperson for the French government.

Updated at 12:17 p.m. to correct the name of the bank.

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