The Seven Largest Sanctions-Related Fines Against Banks
June 30, 2014 4:00 PM
The Justice Department announced a criminal plea and settlement with BNP Paribas on Monday, in which the French bank will pay nearly $8.9 billion to settle charges it willfully continued to do business with countries and entities on the U.S. sanctions list. It was the largest sanctions fine in the Justice Department's history more than four times larger than #2 on the list. The following are the largest penalties paid by banks for sanctions violations.
On Monday, BNP agreed to pay almost $8.9 billion in penalties and pled guilty to settle charges it concealed roughly $8.8 billion of transactions with countries like Sudan, Iran and Cuba. The French government has protested the penalty, saying it was too high, and President Francois Hollande raised the issue personally with President Obama in early June. But in the end, the Justice Department said BNP did not appropriately cooperate with U.S. authorities, necessitating a high fine.
The previous record-holder for largest sanctions fine was HSBC, which in December 2012 paid nearly $1.3 billion as part of a deferred prosecution agreement (The bank also had to pay an additional $665 million in civil penalties). HSBC was accused of conducting transactions on behalf of customers in Cuba, Iran, Libya, Sudan and Burma, all of which were on the sanctions list. Federal authorities also said HSBC allegedly helped to launder around $881 million in drug proceeds through the U.S. financial system.
Earlier that same year, ING was assessed with a $619 million penalty for allegedly moving billions of dollars on behalf of sanctioned Cuban and Iranian entities. Federal authorities said the bank helped move $2 billion worth of transactions on behalf of those entities.
In December of 2009, Credit Suisse paid $536 million for transactions on behalf of customers from Iran and the Sudan. Among other claims, law enforcement officials said that Credit Suisse trained its Iranian clients to falsify wire transfers so that those messages would not be hampered by filters at U.S. financial institutions. Credit Suisse more recently agreed to a $2.6 billion settlement over tax fraud charges.
Similarly, Lloyds TSB Bank was hit with a $350 million fine in January 2009 related to transactions with Iranian customers. Law enforcement officials said the transactions allowed more than $350 million to be processed by U.S. correspondent banks that otherwise might have been blocked or rejected.
In December 2012, Standard Chartered paid $227 million for you guessed it allegedly removing information from wire transfers for customers in Iran, Sudan, Libya and Burma.
