Now for a completely different perspective – US harassment of French banks.
Here’s a different point of view: US efforts to impose draconian penalties on foreign banks for providing financial services in countries that the US doesn’t like it is really just a case of imposing our political preferences on the world.
Since access to dollar-based accounts essentially requires settling transactions in New York-based systems at some point in the transaction, the U.S. is leveraging the location of dollar settlements to force everyone to comply with our foreign policy.
For an explanation of this perspective, check out this article in Financial Times: America prosecutes its interests and persecutes BNP. (Snappy title, by the way – wish I could write that well.)
Just about any transaction in dollars winds up going through New York City, even if the transaction is between two parties outside the US conducted through a non-US bank.
(I don’t quite understand that as a concept. Seems to me, based on my infinitesimal knowledge, that it would be possible to handle wires without going through New York. Might take a couple extra steps, but seems it could be done.)
The US has a problem with certain countries, such as Cuba, Iran, North Korea, and Sudan. To put pressure on those countries, we prohibit Americans from having financial dealings with those countries or anyone in those countries. The next step that process is to prohibit any transaction to or from those countries from going through the US banking system.
Combine those sanctions with the practical detail that most dollar-based transaction in the world have contact with the New York-based banking system at some point and we have the situation where US foreign policy tells banks outside the US who they can’t deal with.
The author describes this combination of factors:
America is using its banking laws not to make its financial system safer, nor to protect its own citizens from predatory financial behaviour, but rather to advance foreign policy and national security objectives.
Then he really gets wound up:
…what we are seeing is unapologetic American exceptionalism, manifesting as extraterritorial powermongering. Using financial regulation as a vehicle for international power politics is extremely effective.
One of several consequences of this behavior by the US is that other countries and banks are less inclined to cooperate with the US on unrelated issues. In addition, from the author’s perspective, this approach appears to be a double standard on our part.