Tuesday, January 26, 2021

French bank fined $8.6m for processing payments for sanctioned Syrian banks

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The U.S. Treasury Department imposed an $8.6 million fine on a French bank that officials said processed payments for blacklisted Syrian financial institutions.

Union de Banques Arabes et Françaises SA, a Paris-based bank that facilitates trade finance between Europe and the Middle East, Africa and Asia, agreed to pay the fine to settle its potential civil liability for apparent violations of U.S. sanctions against Syria, the Treasury’s Office of Foreign Assets Control said Monday.

The majority of UBAF’s violations occurred in late 2011 following an executive order that significantly expanded U.S. sanctions against Syria, and pertained to the processing of internal transfers on behalf of Syrian entities that were followed by corresponding funds transfers through a U.S. bank, OFAC said.

UBAF ultimately processed 127 transactions, totaling $2.08 billion, in apparent violation of the executive order, according to OFAC.

The sanctions watchdog in an enforcement summary Monday said the apparent violations demonstrated UBAF’s “reckless disregard” for its compliance obligations, and warned other financial institutions to be wary of continuing to process U.S. dollar-denominated transactions for entities located in countries that come under comprehensive U.S. sanctions.

 

UBAF couldn’t be reached for comment.

The bank voluntarily disclosed the violations and cooperated with OFAC, which the Treasury unit said it considered to be mitigating factors.

UBAF had a sanctions compliance program in place at the time of the violations, and has taken steps to strengthen it, including by conducting in-person and e-learning training for all employees and by reviewing its business lines and terminating any high-risk services, OFAC said.

 

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