Standard Chartered to Pay $ 1.1 Billion Fine for Money-Laundering and Breaches on Sanctions

Moneylife Digital Team 10 September 2020

Economy & Nation

Standard Chartered (StanChart) has been ordered to pay $1.1billion (about £842m) by the authorities from US and UK to settle allegations of poor controls on money-laundering and breaching sanctions against countries including Iran, say reports.

According to a report from UK's The Guardian , the British bank has agreed to pay $947 million to American agencies, including the US department of justice, over allegations that it violated sanctions against a string of countries including Iran.

"Separately, it was fined £102 million by the financial conduct authority for anti-money-laundering breaches that included “shortcomings” in its counter-terrorism finance controls in the Middle East. It is the second-largest fine ever imposed by the UK regulator for anti-money-laundering failures," the report says.

In April this year, the lender agreed to pay $1.1 billion to US and British authorities for conducting illegal financial transactions that violated sanctions against Iran and other countries.

As per the US treasury department, Standard Chartered processed transactions worth $438m between 2009 and 2014, the majority of which involved Iran-linked accounts from its Dubai branch routing payments through, or to, its New York office or other US-based banks. The latest fines on StanChart settled 'apparent violations' of sanctions imposed against Burma, Zimbabwe, Cuba, Sudan, Syria, and Iran.

Earlier in February, the lender, while announcing its FY2019 results, had mentioned impending fines from the US and UK authorities. It had said, "The resolution of previously disclosed investigations in the UK and US into historical sanctions and financial crime control issues included monetary penalties of $1,086 million, of which $186 million was provided for in the current year."

In fact, in April 2019 itself, StanChart had disclosed penalties it would have to pay for the violations. In its annual report for FY2019, the lender had stated, "In April 2019, the group announced that it had resolved the previously disclosed investigations by the New York department of financial services (NYDFS), the board of governors of the federal reserve system, the department of justice (DOJ), the New York County district attorney’s office (DANY) and the office of foreign assets control (together the US Authorities) concerning historical violations of US sanctions laws and regulations from 2007 through to 2014 and the financial conduct authority (FCA) concerning the effectiveness and governance of historical financial crime controls in the Group’s UK corresponding banking business and in its United Arab Emirates (UAE) branches. Under the terms of the 2019 Resolutions, the group agreed to pay a total of $947 million in monetary penalties to the US Authorities and £102 million to the FCA."

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