After helping Sudanese and Iranian clients move money in spite of U.S. sanctions for a decade, France’s largest bank has pled guilty and accepted a record fine. The New York Times reports:
BNP agreed to plead guilty to criminal charges and pay an $8.9 billion penalty, a record sum for a bank accused of doing business with countries that face United States sanctions. State and federal authorities portrayed BNP, the seventh bank to settle a criminal sanctions violation case but the first to plead guilty, as the worst offender.Like other banks, BNP hid the names of Sudanese and Iranian clients when sending transactions through its New York operations and the broader American financial system. But the wrongdoing was more pervasive at BNP, the authorities found, stretching from at least 2002 into 2012, by which time the investigation was already in full swing.
The French government lobbied heavily to help BNP, which is particularly close to the French state, avoid punishment. When President Hollande was unable to persuade President Obama to intervene, however, the bank was left with very few options in the face of overwhelming evidence of its guilt. As one of its employees internal e-mails read, “The dirty little secret isn’t so secret anymore, oui?”This will not kill BNP Paribas, though the regulatory penalties will affect some of their operations in the short-to-medium term. The French had, however, threatened to hold up an EU-U.S. trade pact should BNP be penalized; we shall see whether they will carry through on that.