BRITISH BANK Barclays has agreed to pay $298 million to settle claims it violated trade laws by facilitating transactions involving banks from countries under US sanctions.

Under a deferred-prosecution agreement filed yesterday in federal court in Washington, the London-based bank agreed to pay $149 million (€116 million) to the US and another $149 million to New York state.

Barclays was accused of violating US financial sanctions against Cuba, Iran, Libya, Sudan and Burma from about March 1995 through September 2006.

Barclays followed the directions of banks in those countries to omit their names in payment messages sent to the New York branch and to other financial institutions, according to court papers. In addition, Barclays amended payment messages to remove information identifying links to the sanctioned companies, prosecutors said.

Barclays said in February it was being investigated by the UK Financial Services Authority over payments involving people or countries under UK treasury sanctions. The bank disclosed the justice department inquiry in 2007.

“Barclays accepts and acknowledges responsibility for its conduct and that of its employees,” according to the deferred prosecution agreement filed with the court yesterday.

The accord requires the bank to voluntarily co-operate with investigators for two years, and then the criminal charges will be dismissed.

Barclays declined to comment on the settlement.

The British lender has been conducting an internal review and reporting the results to US authorities “in relation to the possible resolution of this matter”, the bank said in a statement.

Credit Suisse, Lloyds Banking Group and eight other banks were investigated by the US for processing payments that allowed Iran and other sanctioned nations to gain access to US markets.

Credit Suisse and Lloyds settled with US authorities last year. – (Bloomberg)