Crédit Agricole Corporate and Investment Bank (CACIB), a corporate and investment bank owned by Crédit Agricole S.A. and headquartered in Paris, will pay $787.3 million and enter into a deferred prosecution agreement to settle allegations that it violated the International Emergency Economic Powers Act (IEEPA) and the Trading With the Enemy Act (TWEA).
Credit Agricole was represented by Keith Krakaur, Jamie Boucher and Ryan Junck of Skadden Arps.
Credit Agricole employs over 7,000 employees and has a presence in over 30 countries.
A one-count felony criminal information and a related civil forfeiture complaint were filed in federal court in the District of Columbia charging Credit Agricole with knowingly and willfully conspiring to defraud the United States and to commit violations of IEEPA and TWEA.
Credit Agricole will pay $156 million to the U.S. Attorney’s Office for the District of Columbia and $156 million to the New York County District Attorney’s Office.
The New York County District Attorney announced that Credit Agricole has entered into a separate deferred prosecution agreement, and that, in the corresponding factual statement.
Credit Agricole admitted that it violated New York state law by falsifying the records of New York financial institutions.
The Board of Governors of the Federal Reserve System is announcing that CACIB has agreed to a cease and desist order, to take certain remedial steps to ensure its compliance with U.S. law in its ongoing operations and to pay a civil monetary penalty of $90.3 million.
Under that agreement, Credit Agricole has agreed to, among other things, employ a compliance consultant for a period of one year and pay a monetary penalty of $385 million to DFS.
The Treasury Department’s Office of Foreign Assets Control has also levied a fine of approximately $329.5 million, which will be satisfied by the payments to federal and local agencies.
Between August 2003 and September 2008, CACIB subsidiaries in Geneva knowingly and willfully moved approximately $312 million through the U.S. financial system on behalf of sanctioned entities located in Sudan, Burma, Iran and Cuba.
During this time period, these Credit Agricole subsidiaries employed deceptive practices that concealed the involvement of banks designated as Specially Designated Nationals (SDNs) and other corporate entities in financial transactions that transited through the United States and thereby deprived the United States and Credit Agricole’s New York branch and other U.S. financial institutions of the ability to filter for, and consequently block or reject, sanctioned payments.
The bank’s conduct caused approximately $312 million in unlawful transactions to transit through the United States financial systems—although nearly all of the bank’s violations involved Sudanese business organizations.
Credit Agricole subsidiaries also unlawfully caused transactions on behalf of clients located in Burma, Iran and Cuba to unlawfully transit through the United States as well.
Federal officials alleged that Credit Agricole employees were aware of U.S. sanctions against Sudan and the fact that the sanctions applied to payments the bank sent to the United States.
Credit Agricole has acknowledged that compliance personnel within Credit Agricole subsidiaries in Geneva were aware of the U.S. sanctions against Sudan and that these sanctions applied to payments the bank sent through the United States.
Despite this knowledge, compliance personnel authorized payments on behalf of the bank’s Sudanese customers.
Credit Agricole has admitted that its employees permitted 11 Sudanese banks to maintain U.S. dollar accounts with Credit Agricole — six of the Sudanese banks were SDNs.
Credit Agricole subsidiaries relied primarily on non-transparent payment messages, known as cover payments, to mask the unlawful payments that were sent through the United States.