French bank to pay over $8.9 billion for OFAC violations

The Treasury Department's Office of Foreign Assets Control (OFAC) has announced a $963 million agreement with BNP Paribas SA (BNPP), a French bank and financial services company, to settle potential liability for apparent violations of U.S. sanctions. An OFAC investigation indicated BNPP concealed, removed, omitted, or obscured references to information about U.S.-sanctioned parties in 3,897 financial and trade transactions routed to or through banks in the United States between 2005 and 2012 in apparent violation of the Sudanese Sanctions Regulations, the Iranian Transactions and Sanctions Regulations, the Cuban Assets Control Regulations; and the Burmese Sanctions Regulations. The settlement is the largest to date of any kind for OFAC. In addition, the Federal Reserve Board has announced a $508 million penalty against BNPP, the largest penalty ever assessed by that agency for violations of U.S. sanctions laws, plus a Cease and Desist order issued jointly with the Autorité de Contrôle et de Prudentiel et de Résolution (ACPR), the home country supervisor of BNPP.

These actions are taken in conjunction with actions by the Asset Forfeiture and Money Laundering Section of the Criminal Division of the Department of Justice, the Office of the U.S. Attorney for the Southern District of New York, the New York County District Attorney's Office, and the New York Department of Financial Services for violations of U.S. sanctions laws and various New York State laws. The assessments issued by the agencies total $8.9736 billion in a combination of a forfeiture of $8.8336 billion and various civil money penalties and fines. The forfeiture amount approximates the dollar value of the transactions involved in the allegations.

As part of the penalty extracted by the Department of Financial Services, the bank must suspend its U.S. dollar clearing operations through its New York branch for one year involving business lines on which the misconduct centered.