BNP Paribas pleads guilty to violating US sanctions

The authority said it did this partly through a complicated system of “satellite banks”, and continued to breach sanctions even when compliance officers raised alarms.

“BNP Paribas went to elaborate lengths to conceal prohibited transactions, cover its tracks and deceive US authorities,” US attorney general Eric Holder said. “If sanctions are to have teeth, violations must be punished.”

Benjamin Lawsky, superintendent of financial services at the DFS, said the bank had “engaged in a long-standing scheme that illegally funnelled money to countries involved in terrorism and genocide”.

“As a civil regulator, we are taking action today not only to penalise the bank, but also expose and sanction individual BNP employees for wrongdoing,” he said.

The fine is many times bigger than the previous record for violating sanctions and has been the source of considerable tension between US and French officials, with Francois Hollande, the French president, urging Barack Obama to intervene.

Mr Hollande and officials in his government have warned that a disproportionately-large fine threatens the French financial system and the country’s economy.

The fine outweighs BNP Paribas’ entire annual profits from last year. The French banking regulator said last night that the bank “has a solid solvency and liquidity position, which will allow it to absorb the anticipated consequences of these sanctions.”

BNP Paribas is expected to outline the repercussions of the fine to investors on Tuesday. In a statement last night, chief executive Jean-Laurent Bonnafe said: “We deeply regret the past misconduct that led to this settlement. The failures that have come to light in the course of this investigation run contrary to the principles on which BNP Paribas has always sought to operate.”

The bank said it did not expect any impact on its ability to serve “the vast majority of its clients”.

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