U.S. Hits Block in Bank Probe

France has refused a U.S. request to extradite four former executives suspected of roles in an illegal takeover of an insolvent California insurer in the early 1990s.

French President Jacques Chirac said Friday that the government was still looking for other ways to resolve the case, which centers on French bank Credit Lyonnais.

“The government will continue to actively seek a definitive agreement with American authorities,” Chirac said after a European Union summit.

Thom Mrozek, a spokesman for the U.S. attorney’s office in Los Angeles, said the Justice Department had no comment on Chirac’s statement.

Credit Lyonnais has been under investigation in the United States since authorities learned in 1998 that it secretly acquired the assets of Los Angeles-based Executive Life Insurance Co. in the early 1990s.

Laws at the time barred a bank from owning an insurance firm. Executive Life’s assets included California junk bonds, which the bank sold at a profit of at least $2 billion. Prosecutors claim the bank sought to hide its takeover of the insurer to skirt state and federal restrictions.

Last month, France and Credit Lyonnais, which was once state-run, agreed to pay a $600-million fine to settle the case in California. The deal has yet to be approved by a judge.

Since then, the United States requested the extradition of four former executives who weren’t covered in the out-of-court agreement.

France’s Justice Ministry has named the four men as Jean-Yves Haberer, former chief executive of Credit Lyonnais; Francois Gille, the bank’s former managing director; Jean-Francois Henin, a senior official at the bank; and Emmanuel Cueff, company secretary of Artemis, the holding company belonging to French billionaire businessman Francois Pinault.

Credit Lyonnais was privatized in 1999 and was bought this year by Credit Agricole.