The Bank of Communications, China Merchants Bank and Shanghai Pudong Development Bank were held in contempt earlier this year after they refused to turn over information relating to alleged North Korean efforts to avoid US sanctions.
But the appeals court in Washington sided with the Justice Department in a sealed opinion. 'The district court's contempt orders against all three banks appealed from in these causes is hereby affirmed,' said the court.
The finding means that Shanghai Pudong Development Bank, which had received an administrative subpoena under the US Patriot Act, rather than a grand jury subpoena, could be at risk of losing access to the US financial system.
The Patriot Act allows the US attorney-general or the secretary of the Treasury to cut foreign banks off from correspondent relationships with US financial institutions if they fail to comply with a subpoena.