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Standard Chartered Bank has a network of over 1,700 branches and outlets and 5,600 ATMs in more than 70 countries worldwide (Company Website).
"Nine years on, after paying nearly $1bn in fines to US regulators and law enforcement agencies for sanction breaches and compliance failures, StanChart seems no closer to ending its legal problems. A Financial Times investigation has identified transactions involving Iran that could put the bank at risk of severe penalties ranging from further fines to suspension or loss of its crucial dollar clearing licence. Documents seen by the FT suggest that StanChart continued to seek new business from Iranian and Iran-connected companies after it had committed in 2007 to stop working with such clients. These activities include foreign exchange transactions that, people familiar with StanChart operations say, would have involved the US dollar. The documents suggest the bank - a few months after a costly settlement with US authorities in 2012 - was still internally reviewing its client list and was unable to determine in certain cases whether customers were Iranian or not... The US Department of Justice, the Manhattan district attorney, the Federal Reserve, the New York Department of Financial Services (DFS) and most recently, the New York attorney-general's office, are all investigating StanChart for potential new sanctions breaches. The probes, most of which became public late last year, are scrutinising whether StanChart breached sanctions after the period covered by its 2012 settlement, when the bank declared it had 'ceased all new business with Iranian customers in any currency' five years earlier. A pivotal issue is whether senior executives condoned the bank's continuing business with Iran, according to people familiar with the investigations. (Financial Times, "Standard Chartered: The Iranian connection," 9/20/15)
"Standard Chartered will face another three years of scrutiny by U.S. prosecutors for compliance with government sanctions against certain countries, according to documents filed on Tuesday that also noted another probe of the bank is underway. The original deferred prosecution agreements, struck with the U.S. Justice Department and the Manhattan district attorney over the bank's violations related to U.S. sanctions on Iran and other countries, was due to expire on Wednesday. The agreement to extend the deals means that the bank will face enhanced oversight for a longer period of time and could be hit with harsher penalties. The deferred prosecutions could be pulled back in the next three years and criminal charges against the bank could be filed, said Joan Vollero, a spokeswoman for the Manhattan district attorney. In a statement, the bank said it agreed to the extension and would work with authorities to reach the standard required." (Reuters, "U.S. Extends Scrutiny of Standard Chartered on Sanctions Compliance," 12/9/14)
"U.S. authorities are investigating London-based Standard Chartered Plc for potential U.S. sanctions violations connected to its banking for Iranian-controlled entities in Dubai, according to people familiar with the probe. The latest investigation involving the bank is based, in part, from evidence that emerged during a separate probe of BNP Paribas, the French bank that pleaded guilty this summer to charges related to sanctions-busting and agreed to pay $8.9 billion in penalties, the people said. During the course of the BNP case, U.S. federal and state investigators received evidence the French bank had done business with a Dubai-registered corporation that was a front for an Iranian entity, one source said. Investigators also learned that the company used to have an account with Standard Chartered, according to the source. Such an account would have been covered by U.S. sanctions laws that ban dealings with Iran because activity in the account involved U.S. dollar transactions... Standard Chartered in 2012 paid $667 million to U.S. authorities and entered into deferred prosecution agreements with the Manhattan District Attorney and U.S. Department of Justice over violations stemming from Iran and other sanctioned countries." (Reuters, "Exclusive: U.S. probing Standard Chartered over Dubai banking - sources," 10/31/14)
“As part of talks in Geneva over the nuclear question, Tehran is pressing world powers to speed up trade finance arrangements on humanitarian deals involving both Western and Iranian banks, according to an Iranian government document seen by Reuters and sources familiar with the initiative. Iranian government officials and international trade sources say Tehran wants to simplify complex trade finance arrangements potentially worth billions of dollars, which would alleviate pressure on the country's sanctioned banking system…Iranian government officials said the document, which has been sent to Iran's Supreme National Security Council, tasked with safeguarding Tehran's interests, listed the following banks as ‘available for further actions’: Standard Chartered Bank (London), Societe Generale (Paris), Banque de Commerce et de Placements (BCP) (Geneva), UniCredit Bank (Munich), Commerzbank (Frankfurt), United Bank (Zurich) and BHF Bank (Frankfurt). It was not clear whether these banks had been approached to provide finance. Two business executives familiar with the initiative said they were aware that Standard Chartered, Societe Generale, Commerzbank were among those on the wish list. Commerzbank, Societe Generale, United Bank and BCP all declined to comment. A spokeswoman for Standard Chartered said the bank was not involved and would not get involved in any transaction with any party from Iran.” (Reuters, “Western banks cold-shoulder Iran trade finance scheme,” 3/13/14)
"Standard Chartered Chairman John Peace apologized on Thursday for inaccurate comments he made earlier this month about his bank breaching U.S. sanctions over Iran. The highly unusual retraction indicated U.S. regulators had put pressure on the bank to clarify the comments following a high-profile settlement last year which cost Standard Chartered $667 million. The London-based bank agreed to deferred prosecution agreements with the U.S. Department of Justice and District Attorney of New York as part of the settlement. Peace said on March 5 at a press conference with reporters that Standard Chartered 'had no willful act to avoid sanctions'. But in a statement on Thursday, he said those comments were 'both legally and factually incorrect' and he retracted them. He said they directly contradicted the bank's acceptance of responsibility. 'To be clear, Standard Chartered Bank unequivocally acknowledges and accepts responsibility ... for past knowing and willful criminal conduct in violating U.S. economic sanctions laws and regulations,' Peace said in the statement. He said he 'very much' regretted his earlier comments, which 'were at best inaccurate.'" (Reuters, "Standard Chartered says it made false comments on sanction breaches," 3/21/13)
"Standard Chartered Plc agreed to pay $327 million to resolve allegations that it violated U.S. sanctions against Iran, Sudan and two other countries, capping months of legal headaches for the British bank. The U.S. Justice Department and the New York District Attorney's office said on Monday the bank moved millions of dollars through the U.S. banking system on behalf of customers in the four sanctioned countries. The fine came on top of a separate payment of $340 million made in August by Standard Chartered to New York's state banking regulator over Iranian sanctions. Taken together, the two penalties could almost wipe out the bank's profit growth this year. Nevertheless, its shares nudged higher after Monday's announcement, which was in line with payment provisions the bank disclosed last week." (Reuters, "Standard Chartered to pay $327 million in U.S. sanctions case," 12/10/12)
"HSBC Holdings Plc (HSBA) and Standard Chartered Plc (STAN) may settle U.S. charges involving money-laundering violations and dollar-clearing transactions on behalf of Iranian clients as soon as next week, two people familiar with the negotiations said . . . Standard Chartered has said it expects to pay about $330 million to settle claims by federal regulators that its money- clearing operations violated rules related to U.S. sanctions against Iran. The London-based bank agreed in August to pay $340 million to resolve charges brought by New York’s banking regulator that it hid the identity of Iranian customers involved in dollar-clearing transactions." (Bloomberg News, "HSBC, Standard Chartered Close to Resolving Iran Claims," 12/8/12)
"Standard Chartered expects to pay $330 million to settle a case with U.S. regulators who accused the Asia-focused bank of failing to comply with sanctions against Iran, further denting profit growth this year. The settlement will be on top of the $340 million it paid to New York's Department of Financial Services in the third quarter, which pushed its before tax profit growth in 2012 to a mid-single-digit percentage from more than 10 percent, StanChart said in a statement on Thursday... Standard Chartered said it expected talks with U.S. Federal regulators to conclude shortly, confirming a Reuters report earlier in November." (Reuters, "Standard Chartered sees $330 million Iran fine, profit hit,"12/6/12)
"Standard Chartered said it was aiming for a wider year-end settlement with U.S. authorities investigating its Iran-linked transactions... Standard Chartered, which is negotiating with the Manhattan District Attorney, the U.S. Treasury Department, the Justice Department and the New York Federal Reserve, said last month it could not predict the outcome or quantify potential liabilities...Standard Chartered was bogged down by rising costs in much of 2010 and 2011 as it expanded across Asia. Standard Chartered is one of few still expanding its headcount, which totalled about 85,000 at end-June... Weighing on Standard Chartered's earnings was weakness in India, Singapore's wholesale banking and South Korea's consumer banking, it said... Antos said he expects analysts to revise down Standard Chartered's full-year earnings forecast by another 5-10 percent, given the external headwinds. Despite the slowdown, Standard Chartered said it reduced the amount of money put aside in case of bad loans - its impairment charge - by tens of millions of dollars. In the first half, the bank set aside $583 million for impairment charges. A $1 billion loan Standard Chartered made to the Indonesian chairman of London-listed coal miner Bumi Plc - which is probing alleged financial irregularities at its Indonesian units - triggered some concern over the bank's asset quality and lending practices. Standard Chartered shares were down 0.6 percent in London, lagging a 1.1 percent gain in the European bank index." (Reuters, "Standard Chartered eyes wider Iran settlement by year end," 10/30/12)
"Minutes after New York State’s Department of Financial Services announced a $340 million settlement with British bank Standard Chartered for doing business in Iran, the main lobby group pushing for increased sanctions against anyone doing business with the Islamic Republic issued a statement of its own on Tuesday. Former U.S. Ambassador to the United Nations Mark Wallace, CEO of United Against a Nuclear Iran, said 'given the reports of Standard Chartered’s egregious actions the penalty should have been more severe.' Benjamin Lawsky, the head of New York’s Department of Financial Services accused Standard Chartered of conducting '60,000 secret transactions, involving at least $250 billion and reaping millions of dollars in fees' from its Iranian business ties. The New York DFS also said executives at Standard Chartered lied to them about their dealings with Iran... 'This is no time for a slap on the wrist,' he said. 'We think they should get the equivalent of the financial death penalty — meaning losing their license to do business in the United States and New York.' Wallace and his group are calling for a 'complete and total economic blockade of Iran.' Standard Chartered’s records indicate the bank had operating income of $17 billion dollars in 2011. Critics of settlements with other banks and businesses in similar cases claim millions in fines for companies making billions of dollars isn’t the right message to send. Many members of congress and in the diplomatic community have been arguing companies like Standard Chartered should be forced to make a choice: Do business in the United States or in Iran, but not in both. It’s still unclear if Standard Chartered will have to deal with federal consequences as well." (CNBC, "Standard Chartered's Penalty Not Severe Enough: Fmr. Ambassador," 8/14/12)
"Standard Chartered has settled allegations that it helped Iranian clients dodge US sanctions, announcing a fine of $340 million from a New York Banking watchdog... Standard Chartered CEO Peter Sands was in New York at the time the deal was struck. New York state's Department of Financial Services had questioned whether Standard Chartered should lose its banking license, effectively cutting off access to the US market. 'Standard Chartered had offered to settle for $5 million, so (it is) clearly an increase,' said Morningstar analyst Erin Davis... But Standard Chartered remains in the sights of other US regulators... 'Our investigation continues. Treasury will continue working with our regulatory and law enforcement partners to hold Standard Chartered accountable for any sanctionable activity that occured,' an official said... Standard Chartered hinted that settlements may also be reached with those agencies, saying 'the timing of any resolution will be communicated in due course.' The 'United Against Nuclear Iran' lobby group said New York authorities had been to lenient, and federal investigators should not make the same mistake. 'Any financial institution that is found to be in violation of Iran sanctions should receive the financial equivalent of the death penalty and lose its license to do business in the United States,' the group said in a statement." (AFP, "Standard Chartered fined $350 mn over Iran deals," 8/14/12)
"New York’s financial-services regulator has grounds to shut Standard Chartered Plc (STAN) in the state even if he accepts the firm’s argument that it illegally laundered only a fraction of the $250 billion he claims.
As the state’s top banking regulator, Benjamin Lawsky has power to act in his discretion against any financial institution he deems untrustworthy, according to the charter of his year-old department.
Penalties he could impose include fines and the revocation of the bank’s license to operate in the state. Lawsky is said to be considering a settlement figure as high as $700 million, according to person familiar with the case. That would match the amount HSBC Holdings Plc set aside last month to resolve allegations of similar behavior.
Since the Aug. 6 issuance of an order from Lawsky’s Department of Financial Services threatened to revoke Standard Chartered’s license, the bank has focused its defense on the amount it laundered, saying it involved less than one percent of the 60,000 Iranian wire transfers asserted by Lawsky.
Even if Standard Chartered’s position is legally sound, the order’s disclosure of internal e-mails suggesting a conspiracy to hide the identity of Iranian clients from regulators has given Lawsky grounds to act when the two sides face off at an administrative hearing Aug. 15, according to experts on both sides of the Atlantic.
'I don’t care whether it is a half of one percent that weren’t right,' said Arthur Levitt, former chairman of the Securities and Exchange Commission, in an interview yesterday on Bloomberg Radio…Standard Chartered’s apparent effort to conceal the identity of its Iranian counterparties violated the terms of a 2004 settlement between it and the state of New York, in which the London bank pledged 'to ensure compliance with all record keeping and reporting requirements,' according to the order.
For almost a decade starting in 2001, Standard Chartered operated under what Lawsky’s order called a 'deceptive business plan' designed to conceal from regulators that it was processing money transfers for Iranian clients, including the central bank’s U.S. dollar transactions related to oil sales. The order cites bank e-mails and other internal documents to support its accusations…In addition to evading federal controls, Standard Chartered covered up its plan to grab market share in the Iranian funds market by falsifying business records, making false statements to the department, maintaining inaccurate books, obstructing department oversight and failing to report misconduct promptly, according to the order.
The bank stripped out references to Iranian clients in directions for Society of Worldwide Interbank Financial Telecommunications (SWIFT) wire payments made in U.S. dollars through its New York branch, according to the order.
The bank’s outside legal counsel advised that this system was not in compliance with U.S. economic sanctions and that the New York branch needed to be able to verify that transfers were permissible, according to the order…Accusing the bank of 'being motivated by greed,' the department’s order concludes that Standard Chartered’s 'most senior management designed and implemented an elaborate scheme by which to use its New York branch as a front for prohibited dealngs with Iran -- dealings that indisputably help sustain a global threat to peace and stability. By definition, any banking institution that engages in such conduct is unsafe and unsound.'" (Bloomberg, "Standard Chartered’s Fitness Is Key Grounds for Shutdown," 8/10/12)
"The U.S. Treasury told the British government on Wednesday that it takes financial sanctions violations 'extremely seriously' and is coordinating with federal and state agencies in an investigation of the UK's Standard Chartered bank.
Adam Szubin, director of Treasury's Office of Foreign Assets Control, told the British Treasury in a letter obtained by Reuters that his office is investigating the bank for 'potential Iran-related violations as well as a broader set of potential sanctions violations.'
The letter, dated August 8, was in response to a British request for clarification of U.S. sanctions laws and comes after New York State authorities alleged that Standard Chartered hid $250 billion of Iranian banking transactions, in violation of U.S. law.
Szubin told British authorities that in 2008 the Treasury Department outlawed the so-called U-turn transaction license - licenses the New York banking regulator accused Standard Chartered of using to evade sanctions.
The New York State Department of Financial Services order alleged that even as some banks exited the U-turn transactions, Standard Chartered hustled to 'take the abandoned market share.'" (Reuters, "U.S. Treasury tells UK it is probing Standard Chartered," 8/8/12)
"Standard Chartered Plc (STAN) fell the most in almost 24 years as an analyst estimated it may face costs of $5.5 billion after being accused of violating U.S. money laundering laws over its dealings with Iranian banks. The shares fell 16 percent to 1,228.5 pence in London trading, their biggest decline since 1988, the earliest date for which data are available. Standard Chartered may lose its license to operate in New York after the state’s Department of Financial Services found the bank conducted $250 billion of deals with Iranian banks over seven years and earned hundreds of millions of dollars in fees for handling transactions for institutions subject to U.S. economic sanctions. The London-based lender today denied the allegations, saying it 'strongly rejects the position and portrayal of facts' made by the regulator. The bank may be fined $1.5 billion by U.S. regulators, lose about $1 billion of revenue from its Iranian operation and a further $3 billion in market value if senior managers quit, Cormac Leech, an analyst at London-based Liberum Capital Ltd. who rates the stock a buy, wrote in a note to investors today . . . While Standard Chartered doesn’t have any domestic U.S. banking operations, the loss of the New York license would hinder its ability to process dollar payments for clients with businesses in the U.S. and in emerging markets, said Gary Greenwood, an analyst at Shore Capital in Liverpool, who rates the stock a buy. Pretax profit from Standard Chartered’s U.S., U.K. and European unit increased 90 percent in the first half to about $464 million, for about 12 percent of the bank’s total." (Bloomberg, "Standard Chartered Falls Most In 24 Years On Iran Probe," 8/7/12)
"A New York bank regulator’s broadside against Standard Chartered Plc for allegedly hiding US$250-billion in transactions tied to Iran left investors and the bank questioning the motive for the ambush, which wiped US$17-billion off its value. London-based Standard Chartered hit back at the New York State Department of Financial Services (DFS) threat to tear up its state banking licence on Tuesday, dismissing the charge that it was a 'rogue institution' that 'schemed' with the Iranian government as a distortion of the facts. Bank insiders were as shocked as investors by the ferocity of the DFS accusations over its involvement with Iran, which is subject to U.S. sanctions over its nuclear program . . . The U.S. agency said Standard Chartered hid 60,000 secret transactions to generate hundreds of millions of dollars in fees over nearly 10 years. Shares in Standard Chartered closed down 16.4% at 12.28 pounds, taking their losses to 24% since the news surfaced just before Monday’s close. They had earlier slumped as low as 10.92, their lowest for three years." (Reuters, "Iran accusations wipe US$17-billion off Standard Chartered shares," 8/7/12)
"Standard Chartered, the British bank accused of covering up billions of dollars of sanctions-busting transactions with Iran, has come out fighting against the allegations . . . There were no excuses from Standard Chartered, however, on Monday after the New York State Department of Financial Services claimed that the bank’s alleged illicit dealings had left the U.S. financial system 'vulnerable to terrorists, weapons dealers, drug kingpins and corrupt regimes' . . . Standard Chartered was itself among the targets of a 'name and shame' campaign by United Against Nuclear Iran (U.A.N.I.), a non-profit group headed by Mark Wallace, a former U.S. ambassador to the United Nations. U.A.N.I., which gave Standard Chartered a clean bill of health in May after it pulled out of Iran, returned to the attack on Monday by saying the penalties the bank now faced in the light of the latest allegations 'should serve as notice to all entities and financial institutions that they will be held accountable for their business with such an unscrupulous regime.' The pro-sanctions lobby can certainly argue that the measures against Iran are having an impact. The Iranian currency, the rial, is in free fall as the country braces for a fresh devaluation brought on by the economic restrictions . . . Leon Panetta, the American Secretary of Defense, has insisted sanctions against Iran were working, even if 'the results of that may not be obvious at the moment.'" (New York Times, "British Bank Fights U.S. Charges of Dealing With Iran," 8/7/12)
"A British bank schemed with the Iranian government to launder $250 billion from 2001 to 2007, leaving the United States' financial system 'vulnerable to terrorists,' New York's financial regulator charged Monday. State Financial Services Superintendent Benjamin Lawsky signed an order that requires London-based Standard Chartered Bank to answer his questions following an investigation into "wire stripping," the practice of removing crucial identifiers in financial transactions. The state agency called the bank a rogue institution and quoted one of its executives as saying: 'You (expletive) Americans. Who are you to tell us, the rest of the world, that we're not going to deal with Iranians.' The bank conspired with its Iranian clients to route nearly 60,000 different U.S. dollar payments through Standard Chartered's New York branch 'after first stripping information from wire transfer messages used to identify sanctioned countries, individuals and entities,' according to agency's order. The order said the transactions provided the bank with millions of dollars in fees at a time when such trade was restricted . . . If proven, the scheme would violate state money-laundering laws. The order also accuses the bank of falsifying business records, obstructing governmental administration, failing to report misconduct to the state quickly, evading federal sanctions and other illegal acts." (Associated Press, "Standard Chartered Bank Accused Of Scheming With Iran To Launder $250 Billion," 8/6/12)
"Standard Chartered PLC has pulled out of Iran after decades of having a presence, the latest bank to exit the lucrative market amid mounting international pressure. The departure of the bank comes as sanctions have forced most western banks to sever or downgrade ties with Iran. Though Standard Chartered had signaled in 2007 it would stop taking any new business in the Islamic Republic after coming under U.S. pressure, it had continued to retain offices in Tehran and on the island of Kish... Kristen Silverberg, the newly appointed president of New York-based pressure group United Against Nuclear Iran, welcomed Standard Chartered's decision to end its business in Iran. 'We call on other banks around the world to follow Standard Chartered by pulling out of Iran, and completely cut off the regime's access to international markets,' said Ms Silverberg, a former U.S. ambassador to the European Union." (The Wall Street Journal, "UK Bank Standard Chartered Exits Iran Amid International Pressure," 5/10/12)
Its Middle East division has a contact listing for its Tehran office (Company Website), and a Middle Eastern development brochure extensively discusses the Iranian economy (Brochure). Business Monitor International notes that "Standard Chartered Bank (Iran) provides international correspondent banking services to Iranian banks and corporate customers around the world. Standard Chartered specialises in structuring trade transactions involving customers and Iranian counterparties" (Business Monitor International - subscription needed).