By Nick Kostov
PARIS -- French bank BNP Paribas SA on Monday agreed to pay $246 million to the U.S. Federal Reserve to resolve a probe of misconduct in its foreign exchange business.
Traders at the French bank who buy and sell U.S. dollars and foreign currencies used electronic chat rooms to collude with rivals to manipulate FX prices and benchmark rates, the Fed said in a statement. It ordered BNP Paribas to improve its senior management oversight and controls relating to the firm's FX trading.
BNP Paribas, which also agreed to a $350 million settlement in May with New York's state banking regulator over the deficiencies, said it "deeply regrets the past misconduct which was a clear breach of the high standards on which the group operates." It added that it has improved its systems of control by increasing resources and staff dedicated to compliance, conducting staff training and launching a new code of conduct that applies to all staff.
BNP Paribas is the latest in a line of banks fined for its failure to stop traders from trying to manipulate foreign exchange markets. Several global banks including Barclays PLC, Citigroup Inc. and J.P. Morgan Chase & Co. have together paid billions of dollars in fines in recent years after being accused of putting profits over the law.
BNP Paribas said the misconduct took place between 2007 and 2013. In January, the Fed banned former BNP Paribas trader Jason Katz, who pleaded guilty to violating federal antitrust laws, from working in the U.S. banking industry for his manipulation of FX prices. It also barred the French lender from re-employing individuals who were involved in the misconduct.
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