Global Investigations Review - The law and practice of international investigations


Thursday, 13 February 2014

BNP Paribas could face sanctions fine

BNP Paribas has recorded a US$1.1 billion charge to its financial statements to cover potential sanctions fines. After discussions with several regulators and law enforcers, the bank conducted an internal investigation of payments to countries, people and entities which may have been subject to US sanctions. The review’s findings have been given to enforcers and discussions are continuing – a “significant” volume of transactions may have contravened Office of Foreign Assets Control measures. The bank said the extent of potential fines or penalties has yet to be determined, and the final figure “could thus be different, possibly very different, from the amount of the provision.”

Canada to increase regulation of virtual currencies

Canada is bringing in new laws to prevent virtual currencies such as Bitcoin from being used to launder money, according to local news reports. Canada’s finance minister Jim Flaherty made the announcement when he revealed the details of this year’s federal budget. It's expected that Financial Transactions and Reports Analysis Centre of Canada (FINTRAC), which is responsible for preventing money laundering, will develop the new law. This comes after the International Institute of Finance, which represents over 450 banks, called for greater regulation of the use of Bitcoin.

Avon in DoJ and SEC discussions

US-headquartered cosmetics company Avon is reportedly in advanced talks with the DoJ and SEC to resolve a long-running FCPA investigation. The company has already had settlements rejected by the agencies: in 2012, the SEC and DoJ sought a “significantly greater” amount than the US$12 million the company had offered. The company disclosed the results of the investigation to the agencies in October 2008, and has racked up US$340 million in costs.

SEC fines two Hong Kong companies for insider trading

Two Hong-Kong based asset management companies have agreed to pay the US Securities & Exchange Commission US$11 million to settle insider trading charges. Traders in Hong Kong and Singapore stood to make US$13 million in illegal profits after shares in oil and gas company Nexen soared by 50 per cent when it was bought by a Chinese company. CITIC Securities International Investment Management (HK) Limited and China Shenghai Investment Management Limited were fined US$6.6 million and US$4.3 million respectively.

SEC hires senior trio

The Securities and Exchange Commission has appointed Paul Leder as director of its office of international affairs, David Fredrickson as chief counsel to the agency's corporation finance division, and Rick Fleming as its first investor advocate. Leder, who joins from Richards Kibbe & Orbe, will advise the agency on cross-border enforcement and regulation, and will coordinate the SEC’s interactions with foreign regulators. Fredrickson was already assistant general counsel to the corporation finance division, and was a former enforcement attorney in the SEC’s San Francisco office. Fleming will head the inaugural investor advocate’s office. He will help retail investors in their interactions with the SEC and self-regulatory agencies; he joins from the North American Securities Administrators Association, where he was deputy general counsel.

Harvard University victim of Romanian bribery scandal

Harvard University will sell some of its Romanian forests after the agent it used to help buy the land was charged with taking bribes, according to the Harvard Crimson. The agent Dragos Lipan Secu was acting on behalf of Harvard-owned business Scolopax, which was buying Romanian forest land. But Secu has been accused of accepting over US$1 million in bribes to convince Scolopax to buy land at an inflated price.

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