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(Adds bank comment and details of settlement)
By Karen Freifeld
NEW YORK/PARIS, Oct 20 (Reuters) - France's Credit AgricoleSA has agreed to pay $787 million for moving hundredsof millions of dollars through the U.S. financial system inviolation of sanctions against Iran, Sudan, and other countries,U.S. authorities said on Tuesday.
The bank omitted information from wire transactions andotherwise masked unlawful payments on behalf of sanctionedentities between 2003 and 2008, the authorities said.
As part of the deal, Credit Agricole Corporate andInvestment Bank (CA-CIB), a subsidiary, entered into deferredprosecution agreements with state and federal authorities.
Credit Agricole, France's third-biggest lender, said thepenalty would be allocated to its pre-existing reserve and willnot affect accounts for the second half of 2015.
The subsidiary was charged with violating the InternationalEmergency Economic Powers Act and Trading with the Enemy Act,and falsifying the records of New York financial institutions,authorities said.
The deferred prosecution agreements, which run for threeyears, allow the Paris-based bank to avoid criminal convictionsif it complies with their terms.
New York's banking regulator said it has ordered the bankto fire an unidentified managing director who drafted a 2005memo detailing the bank's policy for Iranian clients, dubbed"Special Treatment of Iranian Related Payments."
Most of the employees involved in the misconduct are nolonger at the bank, the New York Department of FinancialServices said.
Credit Agricole has also agreed to hire an independentmonitor and to strengthen its compliance programs.
The bulk of the illegal clients were from Sudan, authoritiessaid, including one who described the crisis in the Darfurregion as "an exaggeration in the media," the New York bankingregulator said.
Credit Agricole, through its subsidiaries in Geneva,Switzerland, knowingly moved approximately $312 million throughthe U.S. financial system on behalf of the sanctioned entities,prosecutors said.
Authorities involved in the $787 million deal included theManhattan District Attorney, the U.S. Treasury Department, theFederal Reserve, New York's Department of Financial Services andthe U.S. Attorney's office in Washington, D.C.
Credit Agricole will pay $385 million to New York's DFS,which could have revoked its license to operate in the state.Federal and state prosecutors will split $312 million, and theFederal Reserve will get $90.3 million. The TreasuryDepartment's $329 million penalty is deemed satisfied by theother payments.
Credit Agricole has already made provisions totaling 1.6billion euros ($1.82 billion) against litigation costs aftertaking a further 350 million euro charge related to the U.S.investigation in its second-quarter results.
Credit Agricole is the latest of about a dozen mostlyEuropean international banks penalized in recent years forsanctions-related violations, forfeiting some $14 billion.
Other banks that have reached agreements include Germany'sCommerzbank AG, Amsterdam-based ING Bank NV,Barclays Plc and Switzerland's Credit Suisse Group AG.
Standard Chartered paid $667 million in penaltiesto U.S. authorities in 2012, and another $300 million last year.It is still under investigation for banking Iranian-controlledentities in Dubai, sources have told Reuters.
BNP Paribas, France's largest bank, last year paida record-breaking $8.9 billion in penalties and pleaded guiltyto criminal charges over sanctions-busting. It was also bannedfrom conducting certain U.S. dollar transactions for a year.
Shares in Credit Agricole closed down 0.9 percent onTuesday, when the Stoxx Europe 600 banking sector index was down 0.6 percent.
(Additional Editing by Greg Mahlich, Tom Brown and CarmelCrimmins)
