SCB caught in Iran transaction scandal
(9 August 2012 – Global) New York state regulators have accused Standard Chartered Bank (SCB) of hiding US$250 billion (A$237 billion) in allegedly illegal transactions with Iran over the best part of a decade.
The regulators accused the London-based global bank of 'systematic misconduct' that might have allowed terrorists and criminals to gain access to the country's banking system.
On Monday, New York's Department of Financial Services threatened SCB with fines and possible suspension of its licence to operate in the state, the hub of the United States financial industry, if it could not explain the transactions which allegedly violated US sanctions on Iran.
'For almost 10 years, SCB schemed with the Government of Iran and hid from regulators roughly 60,000 secret transactions, involving at least US$250 billion, and reaping SCB hundreds of millions of dollars in fees.'
SCB is ordered to appear before the department on 15 August to explain the violations and defend the right to operate in the State of New York.
The transactions involved major state-owned Iranian banks, including the country's central bank.
The regulator said Standard Chartered falsified records and obstructed oversight 'in its evident zeal to make hundreds of millions of dollars at almost any cost'.
The transactions 'left the US financial system vulnerable to terrorists, weapons dealers, drug kingpins and corrupt regimes, and deprived law enforcement investigators of crucial information used to track all manner of criminal activity,' it said.
The department said its investigation into the bank also included evidence of possible illegal transactions with Burma, Libya and Sudan while those countries were under US sanctions.
On Monday, New York's Department of Financial Services threatened SCB with fines and possible suspension of its licence to operate in the state, the hub of the United States financial industry, if it could not explain the transactions which allegedly violated US sanctions on Iran.
'For almost 10 years, SCB schemed with the Government of Iran and hid from regulators roughly 60,000 secret transactions, involving at least US$250 billion, and reaping SCB hundreds of millions of dollars in fees.'
SCB is ordered to appear before the department on 15 August to explain the violations and defend the right to operate in the State of New York.
The transactions involved major state-owned Iranian banks, including the country's central bank.
The regulator said Standard Chartered falsified records and obstructed oversight 'in its evident zeal to make hundreds of millions of dollars at almost any cost'.
The transactions 'left the US financial system vulnerable to terrorists, weapons dealers, drug kingpins and corrupt regimes, and deprived law enforcement investigators of crucial information used to track all manner of criminal activity,' it said.
The department said its investigation into the bank also included evidence of possible illegal transactions with Burma, Libya and Sudan while those countries were under US sanctions.
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