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France

France warns BNP fine could affect US-EU trade deal

© Afp

Text by FRANCE 24

Latest update : 2014-06-05

France on Thursday warned that a possible multi-billion US fine on its largest bank, BNP Paribas, for allegedly evading US sanctions on transactions with Sudan, Iran and Syria could affect ongoing EU-US trade talks.

“We must all completely respect the independence of the justice system. But we are also partners with a relationship of trust, and that trust must not be broken,” Finance Minister Michel Sapin told Le Monde daily paper in an interview.

“This could affect the ongoing talks on the free-trade treaty,” he said.

Sapin also said that the members of BNP's staff involved in the transactions at the centre of the US probe had been fired.

US authorities are investigating whether BNP evaded US sanctions on Sudan, Iran and Syria between 2002 and 2009, alleging that the bank stripped identifying information from wire transfers so they could pass through the US financial system without raising red flags.

Sources familiar with the matter have said the potential fine could be approximately $10 billion.

France has called the mooted fine "unreasonable".

French President François Hollande and US President Barack Obama are expected to discuss the BNP fine at a dinner Thursday night while Obama is on a visit to France for commemorations marking the 70th anniversary of D-Day.

Hollande wrote to Obama in April to stating that the possible fine for France’s biggest bank would be “disproportionate”. The French president emphasised the need for a “reasonable” approach by the US justice system in close cooperation with the financial regulatory authorities, an official in Hollande’s office said.

Sapin earlier called the fine “inequitable” in a France 2 TV interview on Wednesday.

Sapin told the TV channel it was neither “possible nor acceptable for us to intervene in the justice proceedings”, but criticised what he, too, described as a "disproportionate" fine.

“Whether it’s a French bank or a European bank, we don’t want American justice conducted in an inequitable way. The amount we’ve seen in the press, from our point of view, is inequitable,” he said.

“Every time a fine of this nature is imposed, if it’s disproportionate to the facts, for whatever bank it is, it has consequences for the bank and for its capacity to lend.”

Foreign Minister Laurent Fabius, whose portfolio includes trade issues, on Tuesday also warned that the fine could jeopardise ongoing transatlantic free-trade talks.

BNP has said publicly only that it is in discussions with US authorities about “certain US dollar payments involving countries, persons and entities that could have been subject to economic sanctions”.

The bank has set aside $1.1 billion for the fine but told shareholders it could be far higher than that. Last month it also said it had improved control processes to ensure such mistakes did not occur again.

(FRANCE 24 with REUTERS, AFP)

 

Date created : 2014-06-05

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