A U.S. district court ordered BNP Paribas SA to pay $80 million for submitting false claims for payment in a federal grain export program.
The fine marks the second U.S. penalty levied against the biggest French bank in less than a month. On June 30, BNP Paribas agreed to pay $8.97 billion for violating U.S. sanctions against Sudan, Iran and Cuba, in a case that reached the highest levels of French and American diplomacy.
The U.S. Justice Department said in a statement that the ruling resolves allegations the bank was part of a “sustained scheme” from 1998 to 2005 to defraud the program, which involved commodity-pay guarantees provided by the U.S. Department of Agriculture.
“We will not tolerate the misuse of taxpayer-funded programs designed to help American businesses,” Stuart F. Delery, assistant attorney general for the Justice Department’s civil division, said in the statement yesterday. “Companies that abuse these programs will be held accountable.”
Julia Boyce, a spokeswoman at BNP Paribas in Paris, declined to comment when reached by phone.
BNP Paribas sought to guarantee payments to U.S. exporters even if it knew they were ineligible for the program, the DOJ said. BNP Paribas submitted claims to the USDA as early as April 2005 for losses from Mexican buyers who had defaulted on purchases of the grain, the DOJ said.
“In some cases, the underlying transactions were shams and did not involve any real shipment of grain,” the department said in its statement.
The case dating to October 2011 revolves around a former trade finance manager, Jovenal “Jerry” Cruz, who worked in BNP Paribas’s Houston office. He pleaded guilty in 2012 to conspiracy to commit fraud and money-laundering, the DOJ said.