BK Bank of New York Mellon Corporation

Bank of New York Mellon Corp. agreed to pay $14.8 million to settle charges that it violated the Foreign Corrupt Practices Act by providing internships to family members of foreign government officials with ties to a Middle Eastern sovereign-wealth fund.

According to the Securities and Exchange Commission, the bank provided student internships to family members of the officials to influence those officials and win or retain contracts to manage and service the assets of the fund.

BNY Mellon provided the internships without following its standard hiring procedures for interns, and the interns weren't qualified for the bank's existing internship programs, the SEC said.

"The FCPA prohibits companies from improperly influencing foreign officials with anything of value," including "valuable student internships," said SEC enforcement official Andrew Ceresney.

The company did have an FCPA compliance policy but maintained few specific controls around the hiring of customers and relatives of customers, according to the SEC. BNY Mellon's system of internal accounting controls was insufficiently tailored to the corruption risks inherent in the hiring of client referrals, and therefore was inadequate to fully effectuate BNY Mellon's stated policy against bribery of foreign officials, the agency added.

In settling the charges, the bank didn't admit or deny wrongdoing.

"We are pleased to reach an agreement with the SEC that allows us to put this matter behind us," the bank said, adding it had already taken steps to enhance existing internal controls and procedures surrounding internship and hiring practices.

Write to Lisa Beilfuss at lisa.beilfuss@wsj.com

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(END) Dow Jones Newswires

August 18, 2015 12:55 ET (16:55 GMT)

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