Who Paid the Largest Criminal Fine in US History?

The largest criminal fine in US history was paid by British bank HSBC Holdings plc in 2012. The bank paid $1.92 billion to settle charges related to its involvement in money laundering and terrorist financing.

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Introduction

In July of 2009, BP Amoco PLC agreed to pay the largest criminal fine in U.S. history. The company pled guilty to a felony count of misrepresenting the level of risk associated with its ill-fated drilling operation in the Gulf of Mexico. The disaster, of course, was the massive oil spill that began in April of 2010 and ultimately released some 4.9 million barrels of crude oil into the environment.

The Largest Criminal Fine in U.S. History

In July of 2009, BP Products North America Inc. agreed to pay the largest criminal fine in U.S. history. The company pleaded guilty to 14 felony counts related to the 2005 explosion at its Texas City refinery, which killed 15 workers and injured 170 others. Under the terms of the plea agreement, BP will pay a total of $4 billion in fines and other penalties.

The Company

The company at the center of the largest criminal fine in U.S. history is German automaker Volkswagen AG. The company admitted to installing software in some of its cars that was used to circumvent U.S. emissions tests for certain air pollutants.

The software, known as a “defeat device,” caused the cars to emit up to 40 times the amount of pollution allowed by law. The Environmental Protection Agency (EPA) estimated that the affected cars released nearly 600,000 metric tons of extra pollution into the air each year.

After an investigation by the EPA and the California Air Resources Board, Volkswagen admitted to using the defeat device and agreed to pay a $2.8 billion criminal fine. The company also agreed to pay up to $1.5 billion in civil penalties and set aside nearly $20 billion to address claims from car owners, dealerships, and federal and state governments.

The Crime

In July 2002, a federal jury in New York City found Five major investment banks guilty of defrauding investors in the $1.4 billion-a-year market for new issues of corporate bonds. The case was brought by then-New York Attorney General Eliot Spitzer, who alleged that the banks had rigged the market by sharing misinformation, making secret deals and otherwise conspiring to drive up prices and fees.

The case against the banks was built on hundreds of hours of taped conversations between traders, in which they can be heard laughing about how they cheated customers, referred to them as “muppets” and boasted about their ill-gotten gains. The tapes, along with internal emails and other evidence, showed that the banks routinely overcharged customers for bonds and failed to disclose conflicts of interest.

The Fine

In July of 2009, Pfizer, the world’s largest pharmaceutical company, paid the U.S. government $2.3 billion to settle civil and criminal allegations that the company had illegally promoted four of its drugs—Bextra, Geodon, Lyrica, and Zyvox— for uses not approved by the FDA. This was the largest criminal fine in U.S. history.

Implications

The largest criminal fine in US history was a penalty of $3.5 billion that was imposed on British bank HSBC in 2012. The penalty was related to the bank’s laundering of money for Mexican drug cartels and terrorist groups. The size of the fine shows how seriously the US government takes this type of crime.

For the Company

This is a huge black mark on the company’s reputation and will likely take years to recover from. In addition to the fine, the company will also likely be subject to increased scrutiny from regulators and lawmakers. This incident is likely to have a ripple effect on the entire industry, as companies will be under pressure to improve safety standards and procedures.

For the Individual

The largest criminal fine in US history was imposed on a French bank for its role in the 1MDB scandal. The total amount of the fine was $5.2 billion. Of that, $2 billion will be paid to the US Department of Justice, $1.4 billion will be paid to the New York County District Attorney’s Office, and $1.4 billion will be paid to the Federal Reserve.

This is a huge fine, and it will have major implications for the individuals involved in the scandal. First and foremost, it is a clear signal that the US authorities are taking this matter very seriously. The size of the fine sends a message that anyone who is involved in future scandals of this nature can expect to face similar consequences.

This fine also sets a new precedent for how large these types of fines can be. In the past, similar fines have been imposed on banks for much smaller amounts. This new record will likely prompt other regulatory agencies to consider imposing similar punishments in the future.

Finally, this fine is likely to have a significant impact on public opinion about corruption in the financial sector. The 1MDB scandal has already caused significant damage to public trust in financial institutions, and this new development is likely to further erode that trust.

Conclusion

In conclusion, BP paid the largest criminal fine in US history, totaling $4.5 billion. This monumental fine was the result of the company’s negligence in the lead up to the Deepwater Horizon oil spill, which caused immense environmental damage and cost many people their livelihoods.

Though the size of the fine may seem like a deterrent to future corporate crime, it is important to remember thatBP is a massive company with immense resources. For smaller companies, a $4.5 billion fine would be crippling, but for BP it is little more than a slap on the wrist. Until our justice system imposes harsher punishments for corporate wrongdoing, we will continue to see large companies putting profits before people and the environment.

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