The Federal Reserve Board and the New York State Banking Department on Wednesday announced the issuance of a consent Order to Cease and Desist against Barclays Bank PLC, London and the bank's branch in New York. The Order requires Barclays Bank to improve its program for compliance with U.S. economic sanctions requirements on a global basis.While it is most interesting that a US regulatory authority can levy a fine on a British bank entity outside of the USA, the move was actually assisted by the UK's Financial Services Authority (FSA), the Fed said further:
The United Kingdom's Financial Services Authority, the home country supervisor of Barclays Bank, has agreed to assist the Federal Reserve in the implementation and supervision of the Order.A fine of 2 times $149 million is a little more than just a slap on the wrist. The move involves several American punishment institutions:
In separate, coordinated actions, the U.S. Department of Justice and the District Attorney for New York County announced the execution of deferred prosecution agreements with Barclays Bank, and the Treasury Department's Office of Foreign Assets Control announced a settlement for violations of its regulations. The settlement agreements all relate to U.S. dollar payments routed through banks in the United States that involved entities or persons subject to U.S. economic sanctions. In the settlements with the Department of Justice and the District Attorney, Barclays Bank has agreed to pay $149 million, each, to the United States and to New York, for a total of $298 million. A copy of the Order is attached.A link to a PDF copy leads to a blank page only.
The field is wide open for speculation remembering that Wachovia was fined $160 million for laundering $378 billion for Mexican drug cartels (or 1/3 of Mexco's GDP!!!) in March 2010.
Comparing these fines/settlements Barclays wrongdoings may have involved similar sums as I don't want to presume that US authorities apply two scales of justice.
Barclays was down 1.2% in early London trading.