Ex-Credit Lyonnais Chairman Pleads Guilty In Executive Life Case
By Associated Press - January 20, 2006LOS ANGELES (AP) _ Former Credit Lyonnais chairman Jean Peyrelevade pleaded guilty to charges involving false statements made in the French bank's purchase of failed insurer Executive Life.
Peyrelevade, 66, appeared in federal court Thursday to enter his pleas to two felony counts of causing Credit Lyonnais to make false statements to the U.S. Federal Reserve. As part of a plea agreement reached with prosecutors, Peyrelevade will be spared any prison time but he will be placed on five years probation, fined $500,000 and barred from visiting the United States for three years.
Meanwhile, the Federal Reserve issued a consent order Thursday that bars Peyrelevade from working for any U.S. bank or U.S. subsidiary of a foreign bank without getting approval from federal banking regulators.
Under the terms of the agreement, Peyrelevade did not admit any wrongdoing. He told U.S. District Judge Dickran Tevrizian that he was pleading "guilty ... although I maintain my innocence."
His attorneys said in a statement that Peyrelevade and his family "were simply ready to get on with their lives and put this whole affair behind them."
Prosecutors accused Peyrelevade and others of covering up the illegal buyout of Executive Life from the Federal Reserve, which later issued sanctions against Credit Lyonnais and fined it $100 million.
California took over the bankrupt Executive Life in 1991. State Insurance Commissioner John Garamendi then sold its junk bond portfolio for $3.25 billion to an investor group financed by French bank Credit Lyonnais. The junk bonds later jumped in value and were worth billions of dollars more.
In 1999, the state Department of Insurance sued the French investors, claiming they had conspired to give Credit Lyonnais control over all of Executive Life's assets, which violated California law at the time prohibiting foreign governments from owning insurers in the state. Most of the original parties named as civil defendants, including Credit Lyonnais, reached a $600 million out-of-court settlement in February 2005.
In November, a federal judge ordered Artemis SA, a company controlled by French billionaire Francois Pinault, to pay California nearly $190 million plus interest as restitution for its role in the takeover of Executive Life. Pinault was cleared of any wrongdoing but his company was found to have misled regulators when it purchased Executive Life's junk bonds.
Although Peyrelevade wasn't named chairman and chief executive until 1993, he was named along with other executives in an indictment. Peyrelevade resigned as the company's chairman in November 2003.
The indictment resulted in plea deals for many of the company's executives, including Jean-Claude Seys, who headed the French insurance firm MAAF Assurances SA, and former Altus chairman Dominique Bazy. | 
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