Banks have been used to having mud slung at them over the past decade for rigging markets, ripping off customers, committing fraud, and generally flouting the law. But there is one activity that they really do not want to be associated with—complicity in war crimes.

At the end of June, however, three French non-governmental organisations (NGOs) filed a legal action against BNP Paribas, alleging that France’s largest bank was complicit in genocide, war crimes, and crimes against humanity during Rwanda’s 1994 genocide.

The suit alleges that in June 1994 Banque Nationale de Paris (BNP)—as the bank was known before its merger with Paribas in 2000 to become BNP Paribas—“participated in financing the purchase of 80 tonnes of arms,” including AK-47 rifles, ammunition, hand-grenades, and mortars, that “served to perpetrate the genocide” despite the fact “that the bank could not have doubted the genocidal intentions of the authorities of the country for which it authorised the transfer” of funds.

The legal action has been brought by Sherpa, an anti-corruption group that defends victims of economic crimes; Ibuka France, an association that defends survivors of the genocide; and the Collective of Civil Parties for Rwanda (CPCR), a group based in France that pursues claims against genocide suspects.

The groups point out that a United Nations arms embargo had been in effect from May and that a Belgian bank—Bank Brussels Lambert (BBL, which was merged into ING Group in 1998)—had already refused to process the transaction, knowing that it would violate the embargo.

Jacques Simal, a BBL employee who was posted to Rwanda’s Banque Commerciale du Rwanda (BCR) up until April 1994, has testified that the banking sector knew full well the crimes that were taking place in Rwanda at that time, which justified BBL freezing BCR’s accounts. And according to testimony provided by Ezakar BIGILINKA, BCR’s foreign department director, “the only institution which agreed to collaborate was BNP, who agreed to transfer the assets [from BCR to Rwanda’s central bank, the National Bank of Rwanda].”

In their complaint against BNP, the NGOs claim the bank authorised two transfers of funds of U.S.$592,784 and U.S.$734,099 respectively (totalling more than U.S.$1.3m) on 14 and 16 June 1994. These were made from an account that the National Bank of Rwanda held with BNP to an account at the private Swiss bank UBP held under the name of Willem Tertius Ehlers, a South African national and former secretary to South African leader P.W. Botha. Ehlers happened to own an arms brokerage firm called Delta Aero at the time.

“It is important that banks and other companies are held to account for what they do directly, as well as what they do indirectly. There is evidence to show that BNP Paribas facilitated transfers to fund arms sales during one of the worst cases of genocide ever seen. It must be held to account.”

Marie-Laure Guislan, Head of Litigation, Sherpa

The suit claims Ehlers and Rwandan Hutu colonel Théoneste Bagosora concluded an arms sale in the Seychelles on the day after the second transfer of funds. It says the weapons were officially purchased by Zaire, as the Democratic Republic of Congo was then known, but with two Rwandans in the delegation that travelled to the Seychelles, one of which was Bagosora. The groups cite testimony that Bagosora gave before the International Criminal Tribunal for Rwanda, which describes how he and his associates transferred the weapons from the Seychelles to Goma, a Zairean city that borders Rwanda, and then into Rwanda.

Bagosora, now 70, is serving a 35-year sentence for crimes against humanity in connection with the genocide.

More than 800,000 ethnic Tutsis and moderate Hutus were slaughtered during a three-month killing spree between April and July 1994 by Hutu extremists after a plane carrying the Rwandan president, Juvenal Habyarimana, was shot down.

Multinationals have faced legal complaints in France for human rights abuses and crimes against humanity. Sherpa was recently in the headlines when it filed a lawsuit against the Swiss-French cement giant LafargeHolcim over allegations that the company may have financed third parties connected to the Islamic State in Syria in exchange for protecting its newly-built operations. It is, however, the first time that a bank has been the subject of a similar complaint.

In an e-mailed statement, BNP Paribas told Compliance Week: “We became aware of the complaint through the media. At the moment, we do not have enough information regarding the complaint to be able to comment on it.”

On 3 July—within a week of the complaint being filed—the bank announced that a new head of compliance would be joining it in October and that it was establishing a new “company engagement department,” responsible, among other things, for setting strategy on human rights. They may well have their work cut out if recent allegations are proven to be true.

Dutch Court sentences director for aiding war crimes

Companies and their executives have occasionally been linked with complicity in acts of terrorism or war crimes. With the recent wave of terrorist attacks in the United Kingdom and Europe, for example, internet and social media companies have been criticised for failing to block extremists and militants from using communicating in online chatrooms and hosting websites.
But prosecuting companies and their directors for their direct involvement in crimes against humanity is almost unheard of—until recently.
On 21 April 2017, the Dutch Appeal Court found 74-year old company director Guus Kouwenhoven guilty of war crimes for selling weapons to Liberia’s then President Charles Taylor, who was convicted in 2012 to 50 years in prison by the Special Court for Sierra Leone for war crimes and crimes against humanity.
In supplying and transporting the weapons, Kouwenhoven was found not only to have breached international sanctions, but also to have acted as an accessory to war crimes including, rape, pillage, inhumane treatment, and murder committed in Liberia and Guinea between August 2000 and December 2002.
In a written summary of their ruling, the Dutch Court concluded that the weapons smuggled in by Kouwenhoven “were used by Taylor in an armed conflict with rebels, in which over a period of many years countless civilians were victimised.” In exchange for weapons, Kouwenhoven—as director of operations of both the Oriental Timber Corporation and the Royal Timber Company—gained trading concessions from Taylor.
Kouwenhoven was sentenced to 19 years in jail. He had originally been sentenced to eight years in prison in 2006, but was later acquitted due to lack of evidence. The current sentence is a result of a retrial.
In its ruling, the Court stated that they hoped that this case would serve as an example to others that in doing business with governments like Taylor’s “they can thereby become involved in serious war crimes.”
—Neil Hodge

This is not the first time BNP Paribas has been accused of violating embargoes. In 2014, it pled guilty to evading U.S. trade embargoes in order to help clients in Sudan, Cuba, and Iran. The bank agreed to pay a U.S.$9bn penalty (for processing over U.S.$30bn of illicit transactions). Over an eight-year period, BNP Paribas helped its clients evade sanctions by covering up their names on transactions and replacing them with secret codes. At the time, then-U.S. Attorney General Eric Holder stated that the bank “continued for years despite repeated indications and warnings that the bank’s conduct violated United States embargoes.”

Indeed, the conduct was so blatant that even the bank’s compliance department was complicit. According to court filings citing an internal bank memo, BNP’s senior compliance personnel agreed to continue doing business with Sudan despite the well-documented human rights violations in Darfur and 1997 U.S.-imposed trade embargo by stating that “the relationship with this body of counterparties is a historical one and the commercial stakes are significant. For these reasons, compliance does not want to stand in the way.”

“BNP Paribas went to elaborate lengths to conceal prohibited transactions, cover its tracks, and deceive U.S. authorities,” said Holder.

Marie-Laure Guislan, head of litigation at Sherpa, says that the case is unlikely to move ahead quickly. “These cases can take months and years to complete,” she says, though she adds that there is no statute of limitations on such crimes, “so there is no deadline for us to make our case by.”

In the meantime, while the groups wait for a judge to investigate the case and decide whether criminal charges can be brought, Guislain says the groups will continue to urge the “new government in France to be really vigilant,” as well as raise public awareness “that banks can be involved in a very serious violation of human rights.” “Already we have received calls from investors who want to know more about the case we are trying to make against BNP Paribas, and more people are asking questions about how banks and multinational companies can conduct their business in this way and knowingly violate the law,” she says.

Sherpa also hopes to draw attention to a new French law, passed in February, obliging French companies with over 5,000 staff—including banks—to prove their “duty of care” in reducing the risk of human rights violations. The legislation—which cannot be used retrospectively to prosecute historic crimes—comes into effect next year, and human rights groups across Europe say they aim to push for similar EU-level legislation. Furthermore, Sherpa and other NGOs also want France’s new government to open archives with the hope of revealing complicity between French officials—not only bankers—and those who committed genocide.

“It is important that banks and other companies are held to account for what they do directly, as well as what they do indirectly,” says Guislain. “There is evidence to show that BNP Paribas facilitated transfers to fund arms sales during one of the worst cases of genocide ever seen. It must be held to account,” she says.