An unnamed person who is familiar with the matter has revealed that US authorities are seeking to arrive at a settlement with BNP Paribas if the bank pays over $10 billion in fines for dealing with sanctioned countries. The French bank is reportedly the subject of federal and state investigations regarding their dealings with countries that have been imposed with economic sanctions, including Iran and Sudan. The person, who refused to be identified as the talks are not public, said that both BNP and the US could agree on a final deal in weeks.
Bloomberg observed that the amount in fines have escalated since talks of a settlement have been made known. In April, BNP was adamant of shelling out more than the $1.1 billion it has already set aside for the case. People who were familiar with the matter have said that prosecutors have been pressuring the firm to submit a guilty plea for moving funds for clients in violations of sanctions imposed against the banned countries, which also include Cuba.
London-based analyst Kinner Lakhani at Citigroup Inc said in a note, "Beyond the uncertainty related to the potential financial settlement, the key issues remain the type of potential charges and impact on BNP's operational capability."
If rumors are true about the amount the US has demanded for the settlement to be reached, Bloomberg said it could be the largest criminal penalty imposed in the US, and would easily eclipse the $4 billion accord BP Plc reaced with the US Justice Department last year.
Estimates of the amount of the settlement BNP and the US could agree to settle varied between analysts and industry observers. Just as Bloomberg News reported that prosecutors are seeking over $5 billion in the BNP accord, analyst Jean Pierre Lambert at Keefe, Bruyette & Woods expected that BNP might pay $7 billion to remain in the the US dollar payment system.
The news agency said negotiations in the BNP-US deal are being handed by Justice Department criminal division head Leslie Caldwell, Manhattan U.S. Attorney Preet Bharara and Manhattan District Attorney Cyrus Vance Jr. It has also been reported that superintendent Benjamin Lawsky of New York's Department of Financial Services, along with the Federal Reserve and the Treasury Department's Office of Foreign Assets Control, are involved in the discussions.
