UNICREDIT TO PAY $1.3 BILLION TO END U.S. SANCTIONS INVESTIGATIONS
May 23, 2019
UniCredit banking group reached a settlement agreement with U.S. and New York authorities for $1.3 billion, following an investigation into the bank’s alleged violation of U.S. sanctions on Iran, Cuba, and other countries. UCB AG, which is better known as HypoVereinsbank, will also plead guilty in D.C. federal court to conspiring to violate Iranian sanctions, and will pay an over $468 million fine and forfeit nearly $317 million.
The U.S. Department of Justice stated that UniCredit’s German subsidiary UCB AG “knowingly and willfully” moved hundreds of millions of dollars through the U.S. financial system between 2002 and 2011 on behalf of sanctioned Iranian entities like Islamic Republic of Iran Shipping Lines (“IRISL”). UCB AG hid IRISL’s involvement when processing transactions by omitting their names in “cover payment” messages sent to U.S. banks. UCB AG also committed similar violations for entities in Cuba, Sudan, and other sanctioned countries.
While the UniCredit banks were credited for their “substantial cooperation” throughout the investigation and have made “significant progress” implementing corrective compliance measures, none of the banks self-disclosed their alleged violations which were described as “egregious” cases.
If you have any questions, please contact Evelyn Sahr (esahr@eckertseamans.com or 202-659-6622); Drew Derco (dderco@eckertseamans.com or 202-659-6665), or Alexander Matthews (amatthews@eckertseamans.com or 202-659-6633).
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