BNP Paribas, France’s largest bank, is set to plead guilty to charges following an investigation into its alleged transferring of billions of dollars on behalf of clients based in countries blacklisted in the United States, such as Sudan. Set to be announced on Monday, the plea deal, between the bank and US authorities, will outline the process used to hide the names of its Sudanese clients whilst carrying out transactions through its US operations between 2002 and 2009. The cash penalty of $8.9bn that the bank faces would be a new record. At present no BNP Paribas employees face criminal charges. Whilst the firm will not have its license revoked by the New York State financial regulator, certain units implicated, such as the Oil and Gas unit in its Paris, Geneva and Singapore operations will be unable to clear dollar transactions for at least six months, an essential function for conducting business with international clients. (New York Times)
Fraud accusation sees Barclays’ share price fall
Barclays faces allegations of misrepresentation of benefits and falsifying documents in a lawsuit filed against the bank by the New York Attorney General. The accusations have seen the bank’s share price fall by 6.5%. The prosecution is focussed on the practice of so-called dark pool trading operations. Dark pools are private trading areas set up by banks and so do not have the transparency of public stock exchanges: they are usually used by institutional investors to trade large blocks of shares. The prosecution alleges that “Barclays grew its dark pool by telling investors they were diving into safe waters” but in fact the dark pools were full of predatory, high-frequency traders, at Barclays invitation, thus not providing the safe haven promised. In an email to all staff, warning of the consequences of this investigation, Barclays’ CEO Antony Jenkins stated “the success of our business depends crucially on our clients being able to rely absolutely on our honesty and integrity.” (BBC News)
Diversity
Glencore appoints first female Board director
Glencore, the commodity trading and mining company, has appointed its first female board director, meaning that all FTSE100 companies now have at least one female board member. Patrice Merrin, a Canadian former mining executive has joined as an independent non-executive director. In 2011 the former trade minister Lord Davies set a target for a 25% female representation on boards by 2015. At the time 21% of the FTSE100 had all male boards. By March this year Glencore was the last remaining such company. The news follows a study released this week showing that quotas on the proportion of women on a board has little effect, beyond increasing board diversity, on the proportion of female managers in a company, the gender pay gap, or family-friendly workplace policies. (Guardian, Sydney Morning Herald)
Policy
Google begins removing ‘right to be forgotten’ search results
Google has begun the process of removing search engine results following on from the European Court of Justice’s landmark ruling in May that gave individuals the right to request the removal of search results associated with their names. The company has updated its technical infrastructure in order to begin removing search results, and appointed a “removals team” in order to evaluate individual requests. Each request has to be assessed separately weighing the public interest against an individuals’ right to privacy. This represents the first real application of the ruling passed last month, and is likely to set precedents for how other companies deal with requests both in terms of timeliness and the level of grants of removal given. To date Google has received over 40,000 requests for removal. At present the removals will only apply to Google’s European sites. (Wall Street Journal)
COMMENTS