UniCredit Group: Return of the billion-dollar settlements

Hot on the heels of Standard Chartered’s settlement with US and UK regulators, US regulators have announced ‘a combined $1.3 billion settlement with federal and state government partners’ reached with banks in UniCredit Group.

The Office of Foreign Assets Control (‘OFAC’) of the US Department of the Treasury said that it had reached ‘three separate agreements totaling $611 million with the following UniCredit Group banks: UniCredit Bank AG in Germany, UniCredit Bank Austria AG in Austria, and UniCredit S.p.A. in Italy,’ which ‘resolve OFAC’s investigations into apparent violations of a number of U.S. sanctions programs, including those related to weapons of mass destruction proliferation.’

It said: ‘[B]etween January 2007 and December 2011, UniCredit Bank AG processed over 2,000 payments totaling over $500 million through financial institutions in the United States in apparent violation of multiple U.S. sanctions programs.

‘During this time period, UniCredit operated U.S. dollar accounts on behalf of the Islamic Republic of Iran Shipping Lines (IRISL) and several companies owned by or otherwise affiliated with IRISL, and managed the accounts of those companies in a manner that obscured the interest or involvement of IRISL in transactions sent to or through U.S. intermediaries.

‘For a number of years up to and including 2011 (UniCredit Bank AG) and 2012 (UniCredit Bank Austria AG and UniCredit Bank S.p.A.), all three banks processed payments to or through the United States in a manner that did not disclose underlying sanctioned persons or countries to U.S. financial institutions which were acting as financial intermediaries.’

In a press release, UniCredit Group said: ‘Prior to and throughout the course of the investigations, UC has voluntarily implemented a major Group-wide and bank-specific remediation and enhancement plan to strengthen its policies, procedures, supports, and controls to ensure full compliance with applicable economic sanctions and internal control requirements. The UniCredit Group will continue to make improvements to its compliance program as part of this comprehensive plan, as well as develop new initiatives to prevent and detect future violations of applicable laws in the ever-changing global financial sector.’