SocGen reaches deals to end probes on Libor, Libya

Societe Generale paid nearly a billion euros last year to settle a case brought by the Libyan Investment Authority. (AFP)
Updated 04 June 2018
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SocGen reaches deals to end probes on Libor, Libya

  • The bank said last month it had set aside one billion euros ($1.2 billion) to settle both the Libor and Libya disputes
  • Societe Generale joins a host of other banks that have reached settlements with US tax authorities for attempting to manipulate the London Interbank Offered Rate

PARIS: France’s second-biggest bank Societe Generale said Monday that it had reached agreements with US and French authorities to settle inquiries into the rigging of Libor interest rates and its dealings in Libya.
The bank did not reveal how much it paid to end the cases, but said that it had already provided for the amount in its accounts and that it would have “no impact on Societe Generale’s results.”
The bank said last month it had set aside one billion euros ($1.2 billion) to settle both the Libor and Libya disputes.
It said the agreements reached with the French financial prosecutor’s office and the US Department of Justice would be submitted to the country’s courts for approval on June 4 and June 5 respectively.
In a statement the bank added that it would provide more details once the settlements were made public by the authorities.
Societe Generale joins a host of other banks that have reached settlements with US tax authorities for attempting to manipulate the London Interbank Offered Rate (Libor), which governs credit costs around the world.
Germany’s largest lender Deutsche Bank paid $240 million to resolve claims that it conspired with other banks to manipulate the rate, while HSBC forked out $100 million.
Barclays, Royal Bank of Scotland, Goldman Sachs and BNP Paribas are among other lenders that have been forced to pay hefty sums to avoid potentially embarrassing court cases.
The legal woes weighing on Societe Generale were compounded by allegations that it channeled bribes to associates of slain Libyan dictator Muammar Qaddafi’s son Seif Al-Islam during Qaddafi’s reign.
Last year, Societe Generale paid nearly a billion euros to settle a case brought by the Libyan Investment Authority (LIA), the country’s sovereign wealth fund.
The LIA accused the French bank of paying at least $58 million to a Panama-registered company called Leinada as part of a “corrupt scheme” to get the LIA to invest billions in Societe Generale and its subsidiaries between 2007 and 2009.
Leinada was at the time headed by an associate of Seif Al-Islam.
While reaching a deal with the Libyan fund to end its long-running lawsuit, Societe Generale remained under investigation in the US and France over the affair.
The announcement by Societe Generale that it had settled with tax authorities marks an end to a scandal which led to the surprise departure of its deputy CEO Didier Valet in March.
Valet was one of two senior executives to step down, along with the bank’s head of retail banking.
The departures rattled investors, casting a pall over Societe Generale’s results in the first quarter, in which it booked higher-than-expected net profits of €850 million.


‘Don’t be too optimistic’: Huawei employees fret at US ban

Updated 26 May 2019
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‘Don’t be too optimistic’: Huawei employees fret at US ban

  • This week Google, whose Android operating system powers most of the world’s smartphones, said it would cut ties with Huawei
  • Another critical partner, ARM Holdings, said it was complying with the US restrictions

BEIJING: While Huawei’s founder brushes aside a US ban against his company, the telecom giant’s employees have been less sanguine, confessing fears for their future in online chat rooms.
Huawei CEO Ren Zhengfei declared this week the company has a hoard of microchips and the ability to make its own in order to withstand a potentially crippling US ban on using American components and software in its products.
“If you really want to know what’s going on with us, you can visit our Xinsheng Community,” Ren told Chinese media, alluding to Huawei’s internal forum partially open to viewers outside the company.
But a peek into Xinsheng shows his words have not reassured everyone within the Shenzhen-based company.
“During difficult times, what should we do as individuals?” posted an employee under the handle Xiao Feng on Thursday.
“At home reduce your debts and maintain enough cash,” Xiao Feng wrote.
“Make a plan for your financial assets and don’t be overly optimistic about your remuneration and income.”
This week Google, whose Android operating system powers most of the world’s smartphones, said it would cut ties with Huawei as a result of the ban.
Another critical partner, ARM Holdings — a British designer of semiconductors owned by Japanese group Softbank — said it was complying with the US restrictions.
“On its own Huawei can’t resolve this problem, we need to seek support from government policy,” one unnamed employee wrote last week, in a post that received dozens of likes and replies.
The employee outlined a plan for China to block off its smartphone market from all American components much in the same way Beijing fostered its Internet tech giants behind a “Great Firewall” that keeps out Google, Facebook, Twitter and dozens of other foreign companies.
“Our domestic market is big enough, we can use this opportunity to build up domestic suppliers and our ecosystem,” the employee wrote.
For his part, Ren advocated the opposite response in his interview with Chinese media.
“We should not promote populism; populism is detrimental to the country,” he said, noting that his family uses Apple products.
Other employees strategized ways to circumvent the US ban.
One advocated turning to Alibaba’s e-commerce platform Taobao to buy the needed components. Another dangled the prospect of setting up dozens of new companies to make purchases from US suppliers.
Many denounced the US and proposed China ban McDonald’s, Coca-Cola and all-American movies and TV shows.
“First time posting under my real name: we must do our jobs well, advance and retreat with our company,” said an employee named Xu Jin.
The tech ban caps months of US effort to isolate Huawei, whose equipment Washington fears could be used as a Trojan horse by Chinese intelligence services.
Still, last week Trump indicated he was willing to include a fix for Huawei in a trade deal that the two economic giants have struggled to seal and US officials issued a 90-day reprieve on the ban.
In Xinsheng, an employee with the handle Youxin lamented: “I want to advance and retreat alongside the company, but then my boss told me to pack up and go,” followed by two sad-face emoticons.