Finally!
UK bank Standard Chartered agreed to shell out roughly $330 million to resolve money laundering accusations levied by a team of US banking regulators and federal law enforcement.
The 150-year-old multinational financial institution, which handles transactions for countries in Asia, Africa and the Middle East. among others, admitted to the Department of Justice, the Federal Reserve and the Treasury Department that it violated New York state law by falsifying the records of its New York-based financial institution and by submitting false statements to its state and federal regulators about its business conduct.
The fat fine comes three months after hard-charging new regulator Ben Lawsky, head of the New York State Department of Financial Services, fined the British bank $340 million, accusing it of flouting US sanctions and laundering $250 billion for the dictatorial Iranian regime.
Back in September, Lawsky’s rapid-fire maneuvering angered StanChart officials and Lawsky’s fellow regulators, who saw the DFS boss as disruptive to the process of foreign negotiations.
Standard Chartered’s $327 million fine today breaks down to $100 million resolution with the Federal Reserve, a $132 million fine with the Treasury’s Office of Foreign Assets Control and the remainder going to Manhattan District Attorney Cyrus Vance’s office and the Department of Justice.
“Investigations of financial institutions, businesses, and individuals who violate US sanctions by misusing banks in New York are vitally important to national security and the integrity of our banking system,” Vance said in a written statement.
The US agencies have been quietly negotiating to strike an agreement with the UK’s second largest bank over the past several months after conducting a three-year long investigation.
OFAC said it doesn’t believe Standard Chartered violated laws on the vast majority of the billions in transactions it processed for foreign entities like Iran between 2001 and 2007.
“While [Standard Chartered Bank’s] omission of information affected approximately 60,000 payments related to Iran totalling $250 billion, the vast majority of those transactions do not appear to have been violations of the Iranian transactions regulations,” the bank wrote in a statement.
Standard Chartered run by CEO Peter Sands also said that it has taken steps to improve its screening of the entities which it does business.
The agreement brings the total amount of sanctions against banks in breach of money-laundering rules, including HSBC Bank, to roughly $2 billion.
That said, some have viewed the fines as a drop in the bucket compared with the billions of dollars allegedly laundered.