adminNew York. – BNP Paribas SA won a reprieve during final talks to settle a criminal probe into US sanctions violations, giving the bank six months to prepare for a ban on handling certain dollar transactions, according to a person with direct knowledge of the matter.
Authorities in the US rebuffed a last-ditch push by the bank to slash an $8,9 billion penalty, two other people said, asking not to be identified because talks are private. The year-long ban on dollar clearing could affect specific business lines, such as oil and gas transactions, and certain offices, such as Geneva, where the alleged illegal transactions took place, a person familiar with the terms said last week.
BNP Paribas, France’s largest bank, was poised to plead guilty yesterday in Manhattan federal court, ending years of investigation by accepting a record penalty for violating US sanctions against rogue nations, people familiar with the case have said.
The talks with state and federal authorities in the US had drawn warnings from French officials against levying disproportionate fines that could harm their nation’s economy and Europe’s banking system.
BNP Paribas, suspected of hiding about $30 billion in transactions, will probably plead guilty to conspiring to violate the International Emergency Economic Powers Act, a person familiar with the discussions said last week.
The Paris-based bank’s board met over the weekend to approve the deal, according to the Financial Times, which reported the delay on the dollar-clearing ban yesterday.
Bertrand Cizeau, a spokesman at BNP Paribas, declined to comment on the final terms. BNP rose 0,1 percent to 49,44 euros in Paris trading, valuing the bank at 61,6 billion euros ($84.1 billion). The shares slumped 13 percent this year and closed at a more than nine-month low on June 26.
US authorities aren’t ruling out the possibility of charging individuals in the future, one of the people said. Doing so would probably require additional investigation, such as pushing for more evidence from overseas, that person said.
The probes are being conducted by the Justice Department, US Attorney Preet Bharara, Manhattan District Attorney Cyrus Vance Jr. and Benjamin Lawsky, superintendent of New York’s Department of Financial Services.
It involves alleged violations of sanctions against Sudan, Iran and Cuba, mostly dating from 2002 to 2009, with some continuing until 2011, another person familiar with the matter has said. Spokesmen for the Justice Department, Bharara, Vance and Lawsky, all declined to comment.
BNP Paribas Chief Executive Officer Jean-Laurent Bonnafe told employees in a letter that the bank’s negotiations were “accelerating” and would conclude “very soon,” according to a June 28 report on the website of French broadcaster i-Tele.
“I want to say clearly: We will be sanctioned heavily,” wrote Bonnafe (52) adding that “dysfunctions happened and mistakes were made,” according to i-Tele. Carine Lauru, a bank spokeswoman, declined to comment on the report. – Bloomberg.
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