* Obama says U.S. president "does not meddle in
* Hollande warns of euro zone "economic consequences"
* Minister Sapin links row over possible fine to trade talks
* Size of U.S. fines is excessive and unhealthy -Eurogroup
* Sapin says BNP has fired some staff over payments
(adds Obama reaction)
By Yann Le Guernigou and Julien Ponthus
PARIS/BRUSSELS, June 5 President Barack Obama
dismissed on Thursday any prospect that he might intervene in
the case of BNP Paribas bank, which faces a possible
huge fine for U.S. sanctions busting, despite pressure from his
Obama, who is due to meet President Francois Hollande in
Paris later in the day, said that decisions on any such
prosecutions lay solely with the U.S. Justice Department.
Hollande has stepped up his defence of France's biggest
listed bank, describing the possible penalty as
"disproportionate", while his government has invoked wider
economic concerns and linked the row to trade talks.
Sources have said U.S. authorities are seeking penalties
including a fine that may top $10 billion for the alleged breach
of sanctions via money transfers involving countries including
Iran, Sudan and Syria.
French attempts to politicise the issue drew a cool response
from Obama. "The tradition of the United States is that the
president does not meddle in prosecutions," he told reporters in
"I do not pick up the phone and tell the attorney general
how to prosecute cases that have been brought. I do not push for
settlements of cases that have been brought. Those are decisions
that are made by an independent Department of Justice."
U.S. Secretary of State John Kerry made a similar comment on
Wednesday, adding the caveat: "We obviously want whatever it is
to be fair and to reflect an appropriateness to whatever it is
that is alleged to have taken place."
On Wednesday Hollande told reporters after a G7 summit in
Brussels that the penalties "could have economic and financial
consequences across the euro zone".
Hollande has already said he will raise the issue when he
meets Obama for dinner on Thursday before ceremonies marking the
70th anniversary of the World War Two D-Day landings in northern
France. He also wrote to the White House on the subject in
April, and has discussed it by telephone.
Hollande said he accepted that the U.S. justice system was
independent but "at the same time we have a relationship between
the United States and France, a partnership, and nothing should
be allowed to compromise that".
French Finance Minister Michel Sapin also weighed in on
Thursday, telling Le Monde newspaper: "This could affect the
ongoing talks on the free-trade treaty."
Obama has made progress on reducing trade barriers between
the United States and European Union a policy priority.
Concern is growing at a European level about the scale of
U.S. fines such as the one BNP Paribas may face. Credit Suisse
already pleaded guilty earlier this year to helping
Americans evade taxes and agreed to pay $2.5 billion.
The head of the group of euro zone finance ministers, Jeroen
Dijsselbloem, also criticised the size of such penalties on
"If you look at the fines the U.S. is putting on banks, a
debate that is going on as we speak, I think that would
certainly create a lot of nervousness," said Dijsselbloem, who
is Eurogroup president.
"Those fines are over-excessive, I think they are much too
high and they are not healthy at all," he said in London.
Hollande's comments about a wider euro zone impact follow
the intervention of European Banking Authority (EBA) chairman
Andrea Enria on Wednesday.
Enria told Reuters the rising penalties faced by some
lenders had become a concern generally for regulators, and
should be factored into this year's "stress test" of banks'
"The point of conduct risks, and of the impact of these
fines and penalties ... on a bank's capital position, is a
concern," Enria said.
BNP has declined to comment on any details of discussions
but has said it is in talks with U.S. authorities about "certain
U.S. dollar payments involving countries, persons and entities
that could have been subject to economic sanctions".
The bank has set aside $1.1 billion for a fine, but told
shareholders the penalty could be far higher than that. It has
also said it has improved control processes to ensure such
mistakes do not occur again.
Sapin also confirmed reports that BNP had fired some staff
in connection with the payments. BNP also declined to comment on
(Reporting by Yann le Guernigou, Ingrid Melander and Maya
Nikolaeva in Paris, Marc Jones on London and Julien Ponthus,
Roberta Rampton and Jeff Mason in Brussels; Writing by Andrew
Callus; editing by David Stamp)