BNP Paribas, a Paris-based international banking group, has been fined $350 million by New York state regulators due to misconduct in its foreign exchange business.
The group has done a fine job of staying out of any trouble in recent months, considering that the group suffered last major setback last year when the SEC imposed a $4 million fine on its Wealth Management Unit.
Activity in the FX markets from 2007 to 2013
The New York Department of Financial Services unveiled that from 2007 to 2013, currency traders at BNP Paribas in New York and other big trading centers participated in chat rooms where they colluded to widen spreads, manipulate the price at which daily benchmark rates were set and hide markups from customers.
The ultimate aim was to artificially increase profits. These individuals have quit, been fired or otherwise disciplined.
“Participants in the foreign exchange market rely on a transparent and fair market to ensure competitive prices for their trades for all participants. Here [BNP Paribas] paid little or no attention to the supervision of its foreign exchange trading business, allowing… traders and others to violate New York State law over the course of many years and repeatedly abused the trust of their customers,” said Maria Vullo, the DFS superintendent.
New York’s DFS directed the bank to improve management oversight, risk management policies and procedures.
About BNP Paribas
BNP Paribas is an international banking group with presence in 75 countries. BNP Paribas is one of the largest banks in the world, serving more than 30 million customers. It was formed through the merger of Banque Nationale de Paris and Paribas in 2000. The bank was the second leading bank in the eurozone in 2016.
Considering above mentioned settlement, the bank’s spokespeople said in a statement that BNP Paribas deeply regrets the past misconduct, and that the bank has already implemented new measures to strengthen its compliance.