German bank WestLB AG last night said it had paid a $3 million fine to the US Federal Reserve.
There were allegations that in 2001 the bank conditioned credit to its corporate customers on whether they also chose the bank as a debt underwriter.
The bank, based in Dusseldorf, Germany, with a branch in New York, consented to the issuance yesterday of a cease-and-desist order and the penalty without admitting to any allegations, the Fed said.
Federal law in general prohibits "tying" the availability of financial products with others.
WestLB spokesman Mr Sam Ostrow said the bank neither confirmed nor denied the allegations. He also said it had put in place measures to ensure compliance with anti-tying restrictions.
In the order, the Fed said the bank had 30 days to present to the Fed a training program for US workers to ensure compliance with anti-tying restrictions, including policies and procedures to govern "relationship banking".
Also, within 30 days, the bank is to notify any customer who agreed in the past to name WestLB as an underwriter in the future in connection with the alleged tying that it would not enforce that condition. The Fed order did not specify how many customers may have been affected and Ostrow declined to comment on the issue.