Commerzbank AG has agreed to pay $1.45 billion to settle sanctions actions for doing business with Iran, Sudan and its failure to have adequate money laundering controls, the DOJ and New York financial regulator said Thursday.
The bank “concealed hundreds of millions of dollars in transactions prohibited by U.S. sanctions laws on behalf of Iranian and Sudanese businesses, the prosecution agreement states. At one point, the bank was concerned that transactions with Iran would be revealed, so in 2003, it created a policy entitled “Routing Instructions Iranian banks for USD payments”. The policy instructed employees to “under no circumstances mention the Iranian background in the cover order.” By concealing these payment details prevented the U.S. from identifying or stopping the transactions that involved sanctioned entities.
In 1995, President Clinton issued an Executive Order finding that the actions and policies of the Government of Iran constituted an unusual and extraordinary threat to the national security of the U.S. and imposed comprehensive trade and financial sanctions on the country. In 1997 President Clinton imposed a trade embargo on Sudan which prohibited virtually all trade and investment activities between the U.S. and Sudan.
The bank concealed hundreds of millions of dollars in transactions prohibited by U.S. sanctions laws on behalf of Iranian and Sudanese businesses,the DOJ said.
The $1.45 billion in federal and state penalties included $563 million in forfeitures and fines to the DOJ for the BSA violations. The Treasury Department’s Office of Foreign Assets Control fined the bank $258.6 million for the sanctions violations. And the New York DFS fined the bank $610 million.
Jeffrey Newman represents whistleblowers