Deutsche Börse, Europe’s largest exchanges operator by market value, has agreed to pay $152m to settle allegations by Washington that its Clearstream settlement business may have violated US sanctions on Iran.
The Frankfurt-based group accepted an offer made last week by the Office of Foreign Assets Control, part of the US government, to end an investigation. The sum is less than half the $340m Deutsche Börse had indicated to investors in January the settlement could total.
The OFAC had been examining Deutsche Börse’s Clearstream settlement and custody business, which settles trades for customers by swapping assets for cash. The agency, which enforces economic and trade sanctions, was looking at transfers within an omnibus account in the US run by Clearstream after it decided to close its Iranian customers’ accounts.
It is the latest settlement levied by the OFAC on financial institutions around the world over alleged sanctions violations. Last year Standard Chartered, the British bank, paid $132m to settle allegations.
The OFAC had offered Deutsche Börse a choice of receiving a “pre-penalty notice” – often a prelude to a civil financial penalty – of $168.8m. Alternatively, it would apply a 10 per cent discount for a total settlement. In response last week, the exchanges operator said: “A settlement with OFAC would not constitute a final determination that a violation has occurred.”
Deutsche Börse made a provision of €114.8m in its third-quarter results last week. Clearstream is central to its growth strategy as tighter regulations require more derivatives trades to be backed by collateral, or insurance for trading. Clearstream has more than €11tn of assets under custody.
