Standard Chartered PLC (LON:STAN) (LON:STAC) has agreed to pay U.S. regulators $327 million to settle its alleged illegal transactions with Iran, Sudan, Libya, and Burma.
This comes after the U.S. Treasury Department said the Standard Chartered Bank’s London and Dubai offices had illegally taken key information from financial transaction records during the period between 2001 to 2007. Customer names from the aforementioned countries had been taken by the bank and subsequently replaced with special characters as a means to disallow other banks from seeing where transactions either came from, or their intended destination, reported CNN.
Agencies that have been included in Monday’s agreement are the Federal Reserve, the U.S. Attorney’s Office for the District of Columbia, the Department of Justice, and the New York District Attorney’s Office, according to CNN. The Fed will receive $100 million from the sum, while the law enforcement agencies will get the $227 million balance. The Treasury’s portion will go to the Justice Department.
Monday’s news is just the latest fine levied on the bank for its actions. Back in August, Standard Chartered PLC (LON:STAN) (LON:STAC) said it would pay $340 million to the New York Department of Financial Services. The settlement also included a provision by Standard Chartered Bank that it would install a monitor and examiners who would report to the department for a minimum of two years.
The fine tally now owed by the bank has reached $667 million.
Standard Chartered PLC (LON:STAN) (LON:STAC) had the following statement on Monday via Forbes:
In the more than five years since the events giving rise to today’s settlements, the Bank has completed a comprehensive review and upgrade of its compliance systems and procedures. Steps taken include strengthening sanctions and customer due-diligence screening systems, the addition of New York-based sanctions-compliance and financial-crime reporting staff, the hiring of an independent consultant to assess its Bank Secrecy Act / anti-money laundering (BSA/AML) program, and the establishment of robust BSA/AML testing, audit, and quality assurances policies and procedures.
After the prior $340 million settlement to the New York Department of Financial Services, here’s where the balance of the $667 will go:
Department of Justice and New York City District Attorney ($95 million) – New York’s DA Cyrus Vance said of the case to the Wall Street Journal,
“Banks occupy positions of trust.It is a bedrock principle that they must deal honestly with their regulators. My Office will accept nothing less – too much is at stake for the people of New York and this country. These cases give teeth to sanctions enforcement, send a strong message about the need for transparency in international banking, and ultimately contribute to the fight against money laundering and terror financing.
Treasury Office of Foreign Assets Control ($132 million) – The fine will go toward settling violations of “sanction programs” in Iran, Burma, Libya and Sudan in the London and Dubai offices of Standard Chartered Bank. As part of the settlement, the payment will go to the Department of Justice as noted in the Treasury Department’s Monday press release.
Federal Reserve ($100 million) – On Monday, the Fed said in a press release that it had imposed the $100 million fine and a cease and desist order against the bank.