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BNP Paribas Debacle Offers Lessons in Compliance

Jaclyn Jaeger | July 22, 2014

Compliance officers hear the story all too often these days: A bank becomes the center of a Justice Department probe for sanctions violations, the press goes on a feeding frenzy, and senior management is left to pick up the pieces—and that’s just the outcome when the investigation ends without charges.

French banking giant BNP Paribas wasn’t so lucky. The bank entered into a guilty plea in July and agreed to a record $8.9 billion settlement—the largest penalty ever obtained by the Justice Department in a criminal economic sanctions case, and the largest in a criminal case involving a bank. It also marks the first time a global bank has agreed to plead guilty to large-scale, systematic violations of U.S. economic sanctions. The plea agreement includes forfeiture of $8.8 billion and a fine of $140 million. 

According to court documents, BNP conspired to violate the International Emergency Economic Powers Act and the Trading With the Enemy Act by concealing more than $...

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