BNP Paribas to pay biggest-ever US fine on foreign bank
France’s BNP Paribas has agreed to pay the biggest-ever fine imposed on a foreign bank by US regulators for breaking American sanctions against countries including Iran and Sudan, sources said Sunday.
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Following months of tough negotiations, BNP has taken the unusual step for a company of pleading guilty and agreeing to pay the 8.9-billion-dollar (6.4-billion-euro) fine in order to avoid a trial, whose result would be uncertain.
The sum is the equivalent of 16 months of the bank’s profits at 2013 levels and is far higher than the 1.1 billion euros it had set aside.
But it can afford to pay, given that it had 94.4 billion euros of funds in 2013.
In 2012 the US fined several foreign banks far less for the same offence.
The UK’s HSBC and Standard Chartered were fined 1.36 bilion euros and 483 million euros respectively and the Netherlands’ ING 446 million euros, while Crédit Suisse was fined 1.87 billion euros in May for incitement to tax evasion.
BNP is also expected to be forced to partially suspend its transactions in dollars, mainly relating to oil and gas carried on from offices in Paris, Geneva and Singapore, but it will have a period of grace in which to find another bank to carry out these operations.
The guilty plea could leave the bank open to damages claims from third parties and might mean US pension funds or local authorities have to close their accounts because of internatl regulations.
About a dozen employees, including former high-ranker Georges Chodron de Courcel, are to quit the bank, sources say.
The transactions were legal in an international law but actionable in the US because they were carried out in dollars or went through clearing houses there.
The French government is dismayed by the size of the fine and President François Hollande raised the question with US President Barack Obama when he visited Paris this month.
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