BNP Paribas SA agreed to pay $246 million to settle Federal Reserve claims that the bank failed to keep its currency traders’ from using electronic chatrooms to manipulate prices, the U.S. central bank said in a statement Monday.
The Fed said the Paris-based lender’s deficiencies -- which also led to a $350 million settlement in May with the New York Department of Financial Services -- constituted unsafe and unsound practices and ordered the bank to improve its oversight and internal controls over foreign-exchange trading. BNP Paribas was among several global banks that have faced billions in fines, regulatory sanctions and legal challenges over the use of chatrooms to influence currency rates, and some of the individuals involved were the targets of criminal prosecutions.
“BNP Paribas deeply regrets the past misconduct, which was a clear breach of the high standards on which the group operates,” the bank said in a statement Monday. The bank has since put in place “extensive measures to strengthen its systems of control and compliance” and introduced a new code of conduct for employees, according to the statement.
The Fed’s order, which focused on a six-year period through 2013, said the bank’s “deficient policies and procedures prevented it from detecting and addressing unsafe and unsound conduct by certain FX traders, including in communications by traders in multibank chatrooms.”
Earlier this year, a former BNP Paribas trader, Jason Katz, pleaded guilty to violating federal antitrust laws. The Fed barred him from the U.S. banking industry in January.
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