Crédit Agricole CIB OFAC Settlement: $329.6M (2015)

For a number of years, up to and including 2008, CA-CIB and certain of its predecessor banks, and CA-CIB's Swiss subsidiary Crédit Agricole (Suisse) S.A. ("CAS") and its predecessors — including Crédit Lyonnais (Suisse) S.A. ("CLS") and Crédit Agricole Indosuez (Suisse) S.A. ("CAIS") — processed thousands of transactions to or through U.S. financial institutions involving countries and/or persons subject to OFAC-administered sanctions. Personnel including managers from various business units were aware of U.S. economic sanctions programs and understood that U.S. financial institutions were required to block or reject transactions involving sanctioned parties. Despite this knowledge, these banks used cover payments and/or implemented special payment practices that omitted references to U.S.-sanctioned parties in U.S. Dollar SWIFT payment messages sent to the United States, thereby preventing U.S. financial institutions from appropriately reviewing and analyzing the transactions for OFAC compliance.

CA-CIB processed 4,055 transactions totaling approximately $337,042,846 between August 6, 2003 and September 16, 2008 involving Sudan in apparent violation of the SSR; 4,024 of those transactions totaling $317,241,069 were processed by CAS or its predecessors, in particular CLS. CA-CIB processed 173 transactions totaling approximately $97,195,314 between January 2004 and June 16, 2008 involving Cuba in apparent violation of the CACR. CA-CIB processed 53 transactions totaling approximately $7,238,281 between August 15, 2003 and October 20, 2008 involving Burma in apparent violation of the BSR. CA-CIB processed 16 transactions totaling approximately $397,453 between October 2003 and December 2006 involving Iran in apparent violation of the ITSR.

OFAC determined that CA-CIB did not voluntarily self-disclose these apparent violations and that the apparent violations constitute an egregious case. Both the statutory maximum and base civil monetary penalty were $1,464,860,377. The base penalty for the Sudan apparent violations was $1,426,084,069; for Cuba, $11,245,000; for Burma, $23,253,308; and for Iran, $4,278,000.

CA-CIB agreed to settle with OFAC for $329,593,585, with the obligation deemed satisfied by payment of an equal or greater amount to U.S. federal, state, or county officials arising out of the same pattern of conduct. This settlement is part of a global resolution among CA-CIB, OFAC, the U.S. Department of Justice, the New York County District Attorney's Office, the Federal Reserve Board of Governors, and the Department of Financial Services of the State of New York.

The conduct at the center of this case — using cover payments and special payment practices to strip references to sanctioned parties from USD SWIFT messages sent to the United States — is a specific technique that prevented U.S. financial institutions from detecting and blocking prohibited transactions. OFAC noted that the majority of the apparent violations occurred between 2003 and 2005 and prior to the publication of the ABN Amro settlement, a reference point OFAC used in assessing the period during which the industry should have understood the risks of this conduct.

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