An Iranian money laundering affair continues to
loom over Britain's Standard Chartered bank, despite a settlement
with a New York oversight agency, officials indicated Wednesday.
Four other US regulators continue to probe the bank's actions after Tuesday's agreement between Standard Chartered and the New York Department of Financial Services. Under the deal, the bank will pay a 340-million-dollar fine for its violations to New York.
The four other regulators - the US Treasury Department, the Federal Reserve, the US Department of Justice and the Manhattan district attorney's office - have all been negotiating with the British bank since 2011, according to The Wall Street Journal on Wednesday.
The bank could face a combined fine from those authorities of around 360 million dollars, according to analysts quoted by The New York Times. That sum could range up to 1 billion dollars, according to an expert, Simon Morris, from the London legal practice of CMS Cameron McKenna, in an interview with Bloomberg TV.
Tuesday's last-minute settlement saved Standard Chartered's operating license in New York, a day before the New York agency had ordered the bank to explain why it should keep its license to operate.
The bank has no US banking operations. However, losing its New York license would have impeded payments made in dollars for clients with businesses in the US and emerging markets.
At issue were charges last week made by New York regulators that Standard was hiding 250 billion dollars worth of transactions with Iranian banks that are under sanctions by the United States because of an ongoing dispute about Iran's nuclear development programme.
The parties agreed Tuesday that at least 250 billion dollars worth of transactions were at stake. The bank also accepted assignment of an overseer for at least another two years to watch over internal controls.
New York's chief regulator in the matter, Benjamin Lawsky, pushed forward with his charges ahead of the other regulators, who said in statements that their investigations continue. The Federal Reserve said it was working with the other agencies "on a comprehensive resolution," The Wall Street Journal reported.
Standard Chartered has rejected the charges that it systematically hid its exchange transactions with Iranian banks. It said that 99.9 per cent of its transaction complied with sanctions, and that only 14 million dollars were not in compliance.
The United States has repeatedly cracked down on international banks because of business with rogue states and money laundering.
In 2012, Barclays agreed to pay 298 million dollars to settle claims that it violated trade laws through contacts with banks in Cuba, Iran, Libya and Sudan. Lloyds of London had to pay 350 million dollars in 2009. The Netherlands' ING paid 619 million dollars in June due to trade with Cuba and Iran.
Standard Chartered stockholders celebrated as its stock values bounced up 4 per cent on the settlement - but that still fell short of the more than 25 per cent lost after the charges were made public last week.
Standard Chartered is considered a leader among Britain's five largest banks. Over the past eight years, the bank reported record earnings year after year despite the global recession and financial crisis. Most of the bank's business is done in Asia, the Middle East and Africa.
The US charges provoked concern among British officials. John Mann, a member of Parliament for the Labour Party, charged that Washington was trying to undermine London's premier position in the financial world. London Mayor Boris Johnson agreed with the charges.
Most Popular Stories
- The Commercial Appeal, Memphis, Tenn., John Beifuss column
- Cabot Street Cinema in Beverly for sale
- Entrepreneurs Chase Social Media
- Will Yahoo Splurge on $1-Billion acquisition of Tumblr?
- Financial Times Twitter, Email Hacked
- European Car Sales up First Time in 20 Months
- Travel Startup Localeur Expands to Houston
- Google Fiber Making an Impact
- Jolie Mastectomy Raises Legal Questions
- 'Star Trek Into Darkness': The Return of Khan?