Sources are reporting that BNP Paribas SA (EPA:BNP) (OTCMKTS:BNPQY) and U.S. prosecutors have reached a broad level agreement whereby the French bank would pay $8 billion to $9 billion to settle allegations it violated U.S. sanctions relating primarily to Sudan between 2002 and 2009.
The proposed settlement could include the French bank pleading guilty to a criminal charge of violating the International Emergency Economic Powers Act.
BNP Paribas in DOJ’s target zone
According to an earlier report from The Wall Street Journal, the U.S. Justice Department has BNP Paribas SA (EPA:BNP) (OTCMKTS:BNPQY) in its sights, seeking to make the French bank pay a $10 billion fine to put to rest a criminal investigation into charges the bank violated US sanctions against Iran and other countries for years.
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The report further pointed out that the DoJ sought $10 billion, which is among the largest penalties ever imposed on any bank. However, BNP Paribas was said to be negotiating that number down to $8 billion, but the bank had yet present its number to the DoJ.
BNP Paribas $30 billion of transactions
According to a report in The Wall Street Journal published today, overall the U.S. authorities examined over $100 billion of transactions that raised suspicions, focusing on about $30 billion they eventually concluded were willfully hidden to avoid detection by U.S. sanctions enforcers.
The following exhibit provides a snapshot of penalties imposed for alleged violations:
France’s biggest bank is facing a probe conducted by several 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.
Though French Finance Minister Michel Sapin on French radio did not comment on a possible deal, he repeated the French position that any penalty should be fair and proportionate. He told France Info: “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’.
During the past two years, the U.S. Justice Department has set records in assessing penalties for corporate misconduct at least seven times. In May, Credit Suisse Group AG (ADR) (NYSE:CS) paid $2.6 billion over charges that it helped Americans evade U.S. taxes.