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France says BNP Paribas fine ‘unreasonable’

Top French officials, including President François Hollande, are pressuring the United States to sweeten a plea deal being offered to BNP Paribas bank over its dealings with blacklisted countries like Sudan and Cuba. On Tuesday France called a proposed multi-billion euro fine 'unreasonable'

France says BNP Paribas fine 'unreasonable'
France's leadership is pressuring the US prosecutors to give BNP Paribas a better deal. Photo: Pascal Pavani/AFP

France's foreign minister on Tuesday labelled as "unreasonable" a €7.3-billion-dollar fine the US is reportedly seeking from BNP Paribas bank on charges of violating sanctions on Iran, Sudan and Cuba.

In the first public comments by a senior French official on the high-profile case, Laurent Fabius said in a television interview that the figure sought by the US was not justified.

"If there was a fault, then it is normal that there be a sanction, but the sanction has to be proportionate and reasonable. These figures are not reasonable," he said.

Meanwhile the New York Times newspaper reported that the governor of the Bank of France, Christian Noyer, had visited New York last week to argue on behalf of BNP Paribas and to warn that such a big fine could have serious effects on the banking sector.

Noyer, who is the highest banking regulatory official in France and also sits on the policy-making body of the European Central Bank, met state and federal prosecutors in New York, the newspaper reported, citing people close to the matter.

Noyer stressed the case could have major repercussions both for BNP, the biggest French bank by capitalisation, and the global economy.

French officials are concerned that as part of a guilty plea, the bank might be forced to suspend a core business operation in New York, which could erode BNP's bottom line, the Times wrote.

It appears likely that the bank might be banned for a limited period from carrying out transactions in dollars, which could drive away part of its international client base.

Noyer was accompanied by the new French banking regulator Edouard Fernandez-Bollo who has been the head of the French prudential and control body ACPR since the beginning of this year.

Fernandez-Bollo had already visited New York the previous week but had been unable to change the attitude of the US authorities, the report said.

President Hollande has also recently raised concerns about a plea deal with the White House, the paper wrote.

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BANK

How one man robbed dozens of French banks

A man who swindled French banks and businesses into giving him millions of euros was sentenced in absentia to seven years in jail on Wednesday. And his victims revealed in court exactly how the smooth talker operated.

How one man robbed dozens of French banks
French bank LCL (Le Credit Lyonnais) was among those targeted. Photo: AFP
Gilbert Chikli, 49, who fled to Israel in 2009 after being charged, was the mastermind of a scheme which saw him fleece some of France's top companies, and is the subject of an international arrest warrant.
   
During the trial, a former director of the Credit Lyonnais bank — now known as LCL — gave the court a run down of Chikli's scheme that convinced her to hand one million euros to a stranger in the bathroom of a Parisian bar.
   
First, a man introducing himself as the president of Credit Lyonnais called her and told her a secret services agent would shortly get hold of her and she should do everything he told her.
   
The agent explained he was working on a case involving money laundering and terrorism and needed her to transfer him money to dismantle a criminal network.
   
“He spoke about attacks, confidentiality, he isolates you. At the time I was under pressure at work and I wanted to do things properly,” she told the court.
   
Among the 33 banks and businesses targeted with the scheme between 2005 and 2006 were consulting group Accenture, which lost 5.9 million euros, the Post Office Bank, HSBC, aerospace firm Dassault, electricity and rail giant Alstom and chic Parisian department store Galeries Lafayette.
   
Some of the affected banks and companies that filed a civil suit were awarded €5.5 million ($6.1 million) in damages and interest.    
 
Two of the fourteen alleged accomplices involved in the trial were acquitted, while the others received fines or jail terms of up to four years in jail.
 
– 'Gift of the gab' –
 
Prosecutor Alice Cherif said Chikli used mental manipulation and harassment to wear down carefully chosen targets.
   
The technique “combines validation: 'I chose you for the mission' … and isolation: 'don't tell your colleagues, your family,” said the magistrate.   
 
The prosecutor said most of the 52 employees who were duped at the various companies had been fired.
   
Chikli managed to swindle a total of 60.5 million euros, 52.6 million euros of which was later recovered.
   
His story inspired a movie that is currently being filmed.
   
In 2010 he proudly told French television he was not a crook and that his scheme was a “game.”
   
“We contact businesses, banks, we pretend to be their president and with a rather extraordinary gift of the gab we manage to get large amounts of money.
   
“Either you have the gift or you don't. You could say I have the gift.”
   
The prosecutor said Chikli pioneered a hoax which had been adopted by copycat fraudsters and become a “scourge” in France, with 710 such cons worth 365 million euros having taken place since 2010, and nearly 1,000 others foiled.
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