File - The logo of BNP Paribas is seen on top of the bank company's building in Fontenay-sous-Bois, eastern Paris, May 30, 2014. REUTERS/Charles Platiau
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Financiers may grumble that the United States is acting like an imperial power in punishing foreign banks for dealings far beyond U.S. territory, but in the end they are more likely to bow to Washington than kick against its dollar muscle.Last week, French politicians and business leaders demanded an end to the global dominance of the U.S. currency – and hence of the U.S. banking system – after a New York court fined French bank BNP Paribas $9 billion for doing business in Sudan, Iran and Cuba. Official regulators outside the United States are starting to look at ways to prevent their own banks and markets from being damaged by the scale of U.S. penalties.BNP has set up a financial security unit in New York to ensure its staff comply with all U.S. sanctions and all of its U.S. dollar flows will ultimately be processed and controlled via its branch in New York, centralizing activities that used to be spread across various international offices.New York attorney Adam Kaufmann dismissed the idea that the United States was engaging in "financial imperialism" overseas or targeting foreign banks for economic gain.As recently as February, BNP Paribas was setting aside just $1.1 billion to cover its U.S. sanctions settlement.
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