Other European banks could face US fines, the head of financial services at the European Commission warned yesterday, as BNP Paribas faced a record $9bn (£5bn) penalty for sanctions busting.
Michel Barnier, the Commissioner for Financial Services, said BNP’s fine and other punishments were “of exceptional severity” but that they reflected “exceptional violations of the law and the volume of them”.
Asked if other banks faced similar fines he said: “Other banks are certainly being investigated by US authorities. The scale of their punishments will reflect the scale of their transgressions.”
Mr Barnier, who had earlier joined French President François Hollande in calling for any punishment to be proportionate, said BNP Paribas had failed to heed previous warnings from the US regulators.
“That’s exactly what we do over here if a US company does not respect European rules,” he told French radio. BNP, which employs 7,500 people in the UK, declined to comment yesterday.
The US Department of Justice and Office of Foreign Assets Control announced the settlement with BNP Paribas late last night. Those two regulators will collect about half the fine while the other half will be shared between Manhattan’s district attorney and the New York Department of Financial Services.
The regulators reportedly found that BNP hid transactions totalling $30bn which breached sanctions imposed against Sudan, Iran and Cuba, largely between 2002 and 2009 but with some as recent as 2012.
On top of the fine, BNP Paribas has been ordered to get rid of at least a dozen staff, most of whom have already left, and it will be barred from clearing dollar transactions in offices reckoned to be most central to the sanctions busting.
These include Geneva, Paris and Singapore but crucially not the United States. The ban will take effect from the beginning of 2015.