The Federal Reserve Board on Monday announced that it will fine BNP Paribas S.A. and certain of its U.S. subsidiaries $246 million for the firm's unsafe and unsound practices in the foreign exchange (FX) markets.
The Board levied the fine after finding deficiencies in BNP Paribas's oversight of, and internal controls over, FX traders who buy and sell U.S. dollars and foreign currencies for the firm's own accounts and for customers. The firm failed to detect and address that its traders used electronic chatrooms to communicate with competitors about their trading positions. The Board's order requires BNP Paribas to improve its senior management oversight and controls relating to the firm's FX trading.
In January 2017, the Board permanently prohibited former BNP Paribas trader Jason Katz from participating in the banking industry for his manipulation of FX prices. The Board is also prohibiting the firm from re-employing individuals who were involved in the conduct underlying this enforcement action.
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