By Nicole Hong 

BNP Paribas SA agreed on Wednesday to pay a $350 million penalty to resolve allegations by New York's banking regulator that foreign-exchange traders at the French bank engaged in collusion to manipulate currency rates.

The New York Department of Financial Services said deficient oversight at BNP Paribas "allowed nearly unfettered misconduct" among traders and salespeople in the bank's foreign-exchange business, in violation of New York banking laws.

The investigation focused on misconduct that began a decade ago, involving at least a dozen BNP Paribas employees around the world.

The Department of Financial Services found that from 2007 until 2013, currency traders at BNP Paribas in New York and other big trading hubs participated in chat rooms where they colluded to widen spreads, manipulate the price at which daily benchmark rates were set and hide markups from customers -- with the ultimate goal of artificially increasing profits.

Under the terms of the consent order, the bank admitted to the regulator's allegations.

"BNP Paribas deeply regrets the past misconduct which led to this settlement," the bank's spokespeople said in a statement, adding that the bank has since implemented new measures to strengthen its compliance.

Write to Nicole Hong at nicole.hong@wsj.com

(END) Dow Jones Newswires

May 24, 2017 14:13 ET (18:13 GMT)