Credit Agricole fined $787 mn for breaking US sanctions
French bank Credit Agricole will pay $787 million in fines and install an independent monitor to resolve charges it violated US sanctions on Iran, Sudan and other countries, regulators announced Tuesday.
US regulators charged Credit Agricole with intentionally mislabeling thousands of transactions during 2003-2008 to disguise from US regulators payments and transfers from parties in Iran, Sudan, Myanmar and Cuba that were sanctioned under US law.
The bank entered into a deferred prosecution with the US Justice Department and acknowledged criminal intent to defraud the US, the Justice Department said.
"Sanctions laws are critical to both our national security and foreign policy interests," said US Attorney Channing Phillips.
"Although Credit Agricole moved quickly to end these unlawful transactions and fully cooperated with investigators, today's resolution demonstrates that there will be significant consequences for any financial institution that allows its foreign subsidiaries that do not intend to respect US law to, nevertheless, access the US financial system."
Credit Agricole said it had taken voluntary steps to improve compliance and is "committed to continue to strengthen its internal procedures and compliance programs regarding sanctions laws."
The bank said it would honor the terms of the deferred prosecution agreement and that it has already set aside funds for the penalty.
- 'Don't mention Sudan' -
From 2003 to 2008, Credit Agricole disguised more than $32 billion in US dollar payments with sanctioned parties, said the New York State Department of Financial Services.
Credit Agricole officials in Geneva, Paris and other locations devised systems to get around filters used by US officials to flag questionable transactions for further review.
Such efforts included referring to sanctioned clients as "one of our customers" or "our good customer." A Sudanese client frequently sent a note to Credit Agricole staff in Geneva, saying: "Don't mention Sudan on this payment order."
One Sudanese client referred to the crisis in the country as "an exaggeration in the media" and urged Credit Agricole to continue to do business there. The client said it would be "a great pity" for the bank to pull back from Sudan during "a period of vastly improved economic prospects brought about by the discovery of oil," the DFS said.
Under the settlement, Credit Agricole will pay $385 million to the New York DFS, $90.3 million to the Federal Reserve, $156 million to the Manhattan District Attorney and $156 million to the Justice Department.
The Treasury Department also signed off on the agreement through its Office of Foreign Assets Control, which said it has "no tolerance for the intentional concealment of sanctions-related information in payments sent to the United States and US financial institutions."
The DFS ordered the French bank to dismiss one additional employee involved who remains at the bank. This employee drafted a memo directing efforts to conceal Iranian payments, DFS said.
Credit Agricole has already fired other employees involved in the scheme, the DFS said.
The agreement with Credit Agricole follows other large penalties on foreign banks for flouting US sanctions, including Commerzbank, HSBC and Standard Chartered. Since 2009, nine banks have forfeited about $12 billion in sanctions cases, according to the Manhattan District Attorney in New York City.
The biggest case was a record $8.9 billion fine for French bank BNP Paribas, which pleaded guilty in June 2014 to US criminal charges for violating sanctions on Iran and Sudan and other countries.
© 2015 AFP