Lyonnais, Agency Plead Guilty

Credit Lyonnais and the French government entered guilty pleas as part of their $770-million agreement to settle charges related to the purchase of insolvent California insurer Executive Life.

U.S. District Judge Dickran Tevrizian in Los Angeles accepted the pleas by Credit Lyonnais and Consortium de Realisation, a French agency, to three counts each of making false statements to the Federal Reserve. Prosecutors continue to press charges against five former executives at the French bank. Credit Lyonnais, which was purchased by Credit Agricole last year, and France still face a civil suit by California regulators.

Altus Finance, a unit of Credit Lyonnais that was then owned by the French government, fraudulently gained control of L.A.-based Executive Life in the 1990s by using other firms as fronts, the plea agreement says.

Tevrizian imposed the agreed-upon sentence of a $100-million fine and $375-million civil penalty to be paid by Consortium de Realisation and a $100-million fine against Credit Lyonnais. French billionaire Francois Pinault’s holding company, Artemis, which agreed to pay a $185-million fine, didn’t face criminal charges because it fulfilled a cooperation agreement, prosecutors said.