News / Economy

BNP Nears Up to $9B Settlement With US Authorities

FILE - The logo of BNP Paribas is seen on the bank's building in Paris, May 30, 2014.
FILE - The logo of BNP Paribas is seen on the bank's building in Paris, May 30, 2014.
Reuters
— French bank BNP Paribas SA is likely to pay $8 billion to $9 billion as part of a potential settlement with U.S. authorities over violations of sanctions, according to a person familiar with the matter.
 
U.S. authorities are investigating whether BNP evaded U.S. sanctions relating primarily to Sudan between 2002 and 2009, and whether it stripped out identifying information from wire transfers so they could pass through the U.S. financial system without raising red flags, sources have said.
 
The size of the potential fine has been a source of tension between France and the United States, with French President Francois Hollande warning against a “disproportionate” penalty that might damage France's biggest listed bank.
 
A big penalty could not only hit BNP's capital position and dividend, but could weaken its attempts to expand in North America as it strives to raise revenue and profits outside its traditional European markets.
 
The U.S. investigation has turned up books and records violations in transactions involving Sudan, Iran and Cuba, a source familiar with the matter said on Sunday.
 
A BNP spokeswoman declined to comment.
 
French Finance Minister Michel Sapin on Monday did not comment on a possible deal, but repeated the French position that any penalty should be fair and proportionate.
 
“The French state, the government... has played its role in telling the Americans: 'Be careful - by all means punish the past but don't punish the future,'” he told France Info radio.
 
Earlier in the month, Reuters reported that U.S. authorities negotiating with BNP at one point suggested a penalty as high as $16 billion, although that was viewed as a negotiating tactic in response to an offer from BNP of about $1 billion.
 
BNP, the biggest collector of investment-banking fees in France according to data from Thomson Reuters and Freeman Consulting, has been negotiating on an almost daily basis with U.S. authorities for weeks.
 
Guilty plea?

 
The potential settlement could include BNP pleading guilty to a criminal charge of violating the International Emergency Economic Powers Act, another source familiar with the matter has said. The potential settlement was first reported by the Wall Street Journal.
 
A further source close to the situation said BNP could accept a guilty plea, but it was unclear if any charge would be against the parent group or at a subsidiary level, such as the Swiss unit including its Geneva commodity trading center.
 
BNP was the world's top financier of commodity trading throughout the 1990s and 2000s. However, it has drastically reduced staffing in its Geneva and Paris offices over the past two years as it cut some of its riskier business and studied implications of the U.S. investigation, BNP insiders and senior trading executives have told Reuters.
 
BNP's revenue targets for its trade financing business could be missed due to the investigation, analysts at Jefferies said in a note last week, citing the risk of it losing business.
 
The bank faces other penalties such as being suspended from clearing clients' dollar transactions, sources close to the situation have said. A source familiar with the matter said on Monday parties were still negotiating the duration of any ban.
 
The U.S. investigations are being conducted by authorities including the U.S. Justice Department, the U.S. Attorney's office in Manhattan, the U.S. Treasury Department, the Manhattan District Attorney's office, and the New York Department of Financial Services.
 
The New York Department of Financial Services, which oversees certain banks in New York, would not revoke the bank's license to operate in New York if BNP agreed to other stiff penalties, a source has said.
 
The state regulator has sought the termination of more than a dozen employees as part of the settlement, at least some of whom have already left.
 
Shares in BNP were little changed at 1500 GMT.

You May Like

Video China Investigates Powerful Former Security Chief

Analysts say move by President Xi is an effort to win more party support, take step toward economic reforms, removing those who would stand in way of change More

South Africa Land Reforms Still Contentious 20 Years Later

Activists argue that the pace of land reform is slow and biased; legal experts question how some proposed reforms would be implemented More

In Vietnam, Religious Freedoms Violated, UN Finds

Beliefs reportedly prompt heavy surveillance, intimidation and travel restrictions More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Gazans in Shelled School Sought Shelteri
X
Scott Bobb
July 30, 2014 8:16 PM
Israel's air and ground assault against Hamas-led fighters in Gaza has forced many Palestinians to flee their homes, seeking safety. But safe places are hard to find, as VOA’s Scott Bobb reports from Jabaliya.
Video

Video Gazans in Shelled School Sought Shelter

Israel's air and ground assault against Hamas-led fighters in Gaza has forced many Palestinians to flee their homes, seeking safety. But safe places are hard to find, as VOA’s Scott Bobb reports from Jabaliya.
Video

Video Rapid Spread of Ebola in West Africa Prompts Global Alert

Across West Africa, health officials are struggling to keep up with what the World Health Organization describes as the worst ebola outbreak on record. The virus has killed hundreds of people this year. U.S. President Barack Obama and other world leaders are watching the developments closely as they weigh what actions, if any, are needed to help contain the disease.
Video

Video Michelle Obama: Young Africans Need to Embrace Women's Rights

U.S. first lady Michelle Obama urged some of Africa's best and brightest to advocate for women's rights in their home countries. As VOA's Pam Dockins explains, Obama spoke to some 500 participants of the Young African Leaders Initiative, a six-week U.S.-based training and development program.
Video

Video Immigrant Influx on Texas Border Heats Up Political Debate

Immigrants from Central America continue to cross the U.S.-Mexico border in south Texas, seeking asylum in the United States, as officials grapple with ways to deal with the problem and provide shelter for thousands of minors among the illegal border crossers. As VOA's Greg Flakus reports from Houston, the issue is complicated by internal U.S. politics and U.S. relations with the troubled nations that immigrants are fleeing.
Video

Video Study: Latino Students Most Segregated in California

Even though legal school segregation ended in the United States 60 years ago, one study finds segregation still occurs in the U.S. based on income and race. The University of California Los Angeles Civil Rights Project finds that students in California are more segregated by race than ever before, especially Latinos. Elizabeth Lee reports for VOA from Los Angeles.
Video

Video Vietnamese Staging Chinese Product Boycott After Oil Rig Spat

China recently pulled an oil rig from an area of the disputed South China Sea that Vietnam also claims. Despite the action, the incident has had a lingering effect on consumers in Vietnam. VOA's Reasey Poch reports from Hanoi on an effort to boycott Chinese products.
Video

Video A Summer Camp for All the World

VIDEO: During workshops and social gatherings, the Global Youth Village summer camp encourages young people to cooperate and embrace their differences, while learning to communicate with people from other countries. VOA's Deborah Block has more.
Video

Video From Cantankerous Warlock to Incorruptible Priest, 'Harry Potter' Actor Embraces Diverse Roles

He’s perhaps best known as Mad Eye Moody, the whimsical wizard in the Harry Potter franchise. But character actor Brendan Gleeson's resume includes dozens of films, and he embraces all the characters he inhabits with equal passion. In an interview with VOA’s Penelope Poulou, Gleeson discussed his new drama "Calvary" and his secret to success.

AppleAndroid

World Currencies

EUR
USD
0.7305
JPY
USD
101.53
GBP
USD
0.5830
CAD
USD
1.0656
INR
USD
60.075

Rates may not be current.