The American SEC said Tuesday that the Bank of New York Mellon has been fined for giving internships to the children of government officials linked with a Middle Eastern sovereign wealth fund in an alleged effort to win business.
Bank of New York Mellon to pay $15 Million fine for giving internships
BNY Mellon gave internships in Europe to the son and nephew of one unnamed government official and to the son of another unnamed official, according to the SEC's order.
The bank has agreed to pay a $14.8 million penalty to settle charges that it violated anti-bribery and internal accounting controls provisions of the Foreign Corrupt Practices Act in 2010 and 2011, without admitting or denying wrongdoing.
"We are pleased to reach an agreement with the SEC that allows us to put this matter behind us. As the SEC noted, we cooperated with the SEC throughout this process and had already taken steps to enhance our existing internal controls and procedures with respect to our internship and hiring practices," a bank spokesperson was quoted a saying in a statement.
BNY Mellon gave internships in Europe to the son and nephew of one unnamed government official and to the son of another unnamed official, according to the SEC's order. The Middle Eastern country of the sovereign wealth fund was not named in the order by the SEC.
The SEC alleged that the bank gave the children internships because they "sought to corruptly influence foreign officials in order to retain and win business managing and servicing the assets of a Middle Eastern sovereign wealth fund."
The statement also says the government officials first approached bank in February 2010 about internships.
In its order, the SEC also published email correspondence between officials of the bank purporting to show the importance of the internships being granted.
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