Societe Generale turns the page on litigation in the United States

US justice has dropped its legal proceedings, which cost the bank $ 2.6 billion.

It is a relief for Societe Generale. The American justice system has definitively abandoned the various legal proceedings against the bank, which cost it a total of 2.6 billion dollars in 2018. In the future, no prosecution can be brought against it in the context of suspicion of corruption. with the Libyan sovereign wealth fund and manipulations of the Libor interbank rate, but also in the embargo violation case.

To settle these disputes which poisoned it, Societe Generale had concluded in 2018 two transactional agreements with several American authorities. They were accompanied by a “Three-year probationary period”, during which the group was required to comply with the terms of the agreement. As this period has expired, the US Department of Justice (DOJ) has decided to close the files. “By asking the courts to drop these lawsuits, the DOJ acknowledged that Société Générale has fulfilled its obligations under the suspension of prosecution agreements.”, the group said in a statement Friday.

As part of the first case, Societe Generale, suspected of corruption with the Libyan sovereign wealth fund and manipulation of Libor, concluded in June 2018 financial agreements with the American Department of Justice, but also with the French justice (the national prosecution) financial). It had paid both parties $ 1.3 billion in total. The Libor affair had also cost Didier Valet, who oversaw the market activities of Societe Generale, his post.

In November 2018, the bank with the red and black logo had agreed to pay $ 1.3 billion to the American authorities, this time to end legal proceedings related to dollar transactions carried out between 2003 and 2013 in countries with subject to US economic sanctions (Cuba, Iran and Sudan). It was the second largest fine imposed by the United States for violating sanctions, after the $ 8.9 billion fine imposed on BNP Paribas in 2014.

Compliance procedures

Since these cases, Societe Generale has significantly revised its internal procedures in order to avoid new violations of regulations. “In recent years, Societe Generale has mobilized very significant resources and resources to strengthen its compliance and control system in order (…) to meet the highest standards in the banking sector in this area”, assures the group, which undertakes to “Continue these efforts”.

For several years, international banks have paid dearly for their past wrongdoing (subprimes, manipulation on the foreign exchange market, tax evasion, etc.). The penalty amounts are astronomical. In 2020 alone, the global bill stands at $ 13 billion, according to a report by the Boston Consulting Group (BCG). Since 2009, establishments have already paid a total of $ 394 billion in fines. American (61%) and European (39%) banks share these sanctions.

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