(The following press release from Manhattan District Attorney Cyrus R. Vance, 
Jr. was received by e-mail. The sender verified the statement.) 
December 10, 2012                                                                
Bank Violated U.S. Sanctions by Moving Hundreds of Millions of Dollars Through 
U.S. for Primarily Iranian and Sudanese Clients and Submitting False Statements 
to State and Federal Regulators 
Investigation into Bank Uncovers Criminal Activity Dating Back to 2001 
District Attorney’s Office and Federal Partners Have Secured More Than $2 
Billion in Settlements Since 2009 
Manhattan District Attorney Cyrus R. Vance, Jr., together with the U.S. 
Department of Justice (DOJ), today announced the resolution of a joint 
investigation into the criminal conduct of STANDARD CHARTERED BANK (SCB), a 
British bank, and the payment of $327 million in penalties and forfeiture to 
resolve the matter. In the Deferred Prosecution Agreement (DPA) and 
corresponding Statement of Facts, SCB admitted that it violated New York State 
law by falsifying the records of New York financial institutions and by 
submitting false statements to its state and federal regulators about its 
business conduct. 
The $327 million resolution includes parallel resolutions of regulatory 
inquiries, in which the Board of Governors of the Federal Reserve System (Board 
of Governors) imposed an additional $100 million civil monetary penalty, and 
the Office of Foreign Assets Control of the United States Department of the 
Treasury (OFAC) issued a settlement of $132 million for apparent violations 
arising out of the same pattern of conduct. 
“Investigations of financial institutions, businesses, and individuals who 
violate U.S. sanctions by misusing banks in New York are vitally important to 
national security and the integrity of our banking system,” said District 
Attorney Vance. “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. I thank 
our federal partners for their cooperation and assistance in pursuing this 
SCB moved more than $200 million through the U.S. financial system primarily on 
behalf of Iranian and Sudanese clients by removing—or “stripping”—information 
that would have revealed the payments as originating with a sanctioned country 
or entity. These transactions otherwise would have been rejected, blocked, or 
stopped for investigation under OFAC regulations. These prohibited 
dollar-denominated transactions violated New York and U.S. laws by concealing 
the illegal nature of these transactions and deceiving U.S. banks into 
processing the illegal payments. 
SCB also displayed a lack of candor in its submissions and responses to the 
Federal Reserve Bank of New York (FRBNY) and the New York State Banking 
Department[1] during a targeted Bank Secrecy Act/Anti-Money Laundering 
(BSA/AML) examination and look-back review from 2004 to 2007. The examination 
and look-back were imposed to address previous compliance failures. Despite a 
detailed risk-rating methodology agreed to by the regulators and SCB, which 
should have identified all payments involving OFAC-sanctioned countries, SCB 
failed to disclose that SCB New York was processing billions of dollars of 
stripped payments for Iranian clients and clients from other sanctioned 
countries. Although the vast majority of these payments were legal under 
then-existent exemptions to the sanctions laws, they nonetheless should have 
been disclosed under the terms of the look-back agreement and in response to 
questions posed by the regulators. This failure to inform was despite the fact 
that SCB and the regulators had agreed that financial transactions with Iran 
and other OFAC-sanctioned entities posed a de facto AML risk. 
Pursuant to the DPA, SCB has agreed to adhere to best practices for 
international banking transparency, implement procedures and training designed 
to ensure U.S. sanctions compliance, and pay $227 million in criminal penalties 
and forfeiture.[2] 
The nearly three-year investigation was conducted jointly with DOJ’s Asset 
Forfeiture and Money Laundering Section, and the National Security Section of 
the United States Attorney’s Office for the District of Columbia. District 
Attorney Vance recognized the substantial contributions of FRBNY and OFAC, 
which conducted their own investigations, the Federal Bureau of Investigation, 
and the Internal Revenue Service Criminal Investigation. 
Assistant Attorney General of the Criminal Division Lanny A. Breuer said: “For 
years, Standard Chartered Bank deliberately violated U.S. laws governing 
transactions involving Sudan, Iran, and other countries subject to U.S. 
sanctions. The United States expects a minimum standard of behavior from all 
financial institutions that enjoy the benefits of the U.S. financial system. 
Standard Chartered’s conduct was flagrant and unacceptable.  Together with the 
Treasury Department and our state and local partners, we will continue our 
unrelenting efforts to hold accountable financial institutions that 
intentionally mislead regulators to do business with sanctioned countries.” 
U.S. Attorney for the District of Columbia Ronald C. Machen, Jr., said: “When 
banks dodge U.S. sanctions laws, they imperil our financial system and our 
national security. Today’s agreement holds Standard Chartered Bank accountable 
for intentionally manipulating transactions to remove references to Iran, 
Sudan, and other sanctioned entities, and then further concealing these 
transactions through misrepresentations to U.S. regulators.  This $227 million 
forfeiture should make clear that trying to skirt U.S. sanctions is bad for 
OFAC Director Adam J. Szubin said: “Today’s settlement is the result of an 
exhaustive interagency investigation into Standard Chartered Bank’s attempts to 
violate U.S. sanctions programs through the ‘stripping’ from payment messages 
of critical information. We remain committed to working with our partners in 
the regulatory and law enforcement community to ensure that the U.S. financial 
system is protected from the risks associated with this type of illicit 
financial behavior.” 
The U.S. government restricts certain countries, including Iran, Sudan, and 
Cuba, as well as entities and individuals from those countries, from accessing 
the U.S. banking system.
OFAC is charged with administering these economic sanctions against targeted 
foreign countries and regimes, terrorists, international narcotics traffickers, 
those engaged in activities related to the proliferation of weapons of mass 
destruction, and other threats to the national security, foreign policy, or 
economy of the United States. Sanctioned financial institutions, countries, and 
individuals generally are prohibited from accessing the U.S. financial system. 
Banks in Manhattan, which process most of the world’s U.S. dollar payments, use 
sophisticated computer systems commonly known as “OFAC filters” to prevent 
sanctioned entities, as well as terrorists, money launderers, and other 
criminals, from gaining access to the U.S. banking system. These OFAC filters 
act as the first line of defense to protect the U.S. financial system. SCB 
helped its sanctioned clients, predominantly from Iran and Sudan, evade U.S. 
banks’ OFAC filters and illegally gain access to the U.S. financial system. 
Beginning in 2001 and continuing through 2007, SCB committed this criminal 
conduct by, among other things: (1) processing U.S. dollar payments on behalf 
of sanctioned customers without reference to the payments’ origin; (2) 
deliberately using a less transparent method of payment messages, known as 
cover payments; (3) eliminating any payment data that would have revealed the 
involvement of sanctioned countries and entities, including Iran and Sudan; and 
(4) advising sanctioned clients on how to conceal their involvement in U.S. 
dollar transactions and evade OFAC filters. 
SCB’s conduct caused unaffiliated U.S. financial institutions to process 
transactions that otherwise should have been rejected, blocked, or stopped for 
investigation pursuant to OFAC regulations. This conduct occurred within SCB 
locations around the world, with the knowledge of senior corporate managers and 
legal and compliance departments. 
District Attorney Vance emphasized that while today’s DPA was designed to 
impose a substantial punishment on SCB, and to send a strong message of 
deterrence to other banks, important mitigating factors led to the agreement to 
defer prosecution. Those factors included the fact that SCB fully cooperated 
throughout the investigation and devoted significant resources to both its 
internal investigation and the investigations conducted by the District 
Attorney’s Office and DOJ. SCB also fully acknowledged and accepted 
responsibility for its conduct, and voluntarily undertook a series of remedial 
actions prior to entering the DPA. Moreover, SCB left the sanctioned entity 
clearing business voluntarily before being contacted by the District Attorney’s 
The Manhattan District Attorney’s Office previously has reached Deferred 
Prosecution Agreements with 
19-million-settlement-ing-bank>, with a penalty of $619 million in 2012; 
Barclays<> for $298 million in 2010; Credit 
es-deferred-prosecution-agreement-credit-suisse> for $536 million in 2009; and 
Lloyds Bank, with a penalty of $350 million in 2009. Within the past four 
years, five banks, including SCB, have forfeited in settlements approximately 
$2 billion for their illegal conduct, with half of the funds being paid to the 
City and State of New York. 
The SCB case was investigated and resolved by Assistant District Attorney 
Edward Starishevsky, Senior Investigative Counsel, and former Assistant 
District Attorney Aaron Wolfson, under the supervision of Assistant District 
Attorney Polly Greenberg, Chief of the Major Economic Crimes Bureau, Assistant 
District Attorney Christopher Conroy, Principal Deputy Chief of the Major 
Economic Crimes Bureau, and Executive Assistant District Attorney Adam S. 
Kaufmann, former Chief of the Investigation Division. Investigative Analyst 
Lewis McCorkle assisted in the investigation, along with former Investigative 
Analysts Marguerite Colson, Sarah Schoknecht, Aaron Davidowitz, and Pope 
District Attorney Vance also thanked the following agencies and individuals for 
their assistance in the investigation: Assistant Attorney General Lanny Breuer, 
Chief of the Criminal Division of the United States Justice Department; Ronald 
C. Machen, Jr., U.S. Attorney for the District of Columbia, Assistant U.S. 
Attorney George P. Varghese of the National Security Section, and Gregg Maisel, 
Chief of the National Security Section; Trial Attorney Clay Porter, Deputy 
Chiefs Jonathan Lopez and Seetha Ramachandran, and Jaikumar Ramaswamy, Chief of 
the Asset Forfeiture and Money Laundering Section of the Criminal Division of 
the United States Justice Department; Thomas Baxter, General Counsel and 
Executive Vice President of FRBNY, Katherine Landy, Counsel, Yoon Hi Greene, 
Vice President and Counsel, and Sean O’Malley, Vice President and Deputy Chief 
Investigator; George Venizelos, Assistant Director in Charge of the FBI New 
York Field Office, and FBI Agents Matt Komar, Brendan Griffin and Keith 
Garwood; Adam J. Szubin, Director of OFAC, Dennis Wood, Assistant Director for 
Sanctions Compliance & Evaluation, and case officer Brandon Reddington at OFAC; 
and Richard Weber, Chief, Internal Revenue Service Criminal Investigations and 
former Chief of the Major Economic Crimes Bureau at the Manhattan District 
Attorney’s Office, and IRS Agents Nicole Davis and Allison Lareau. 
(bjh) NY
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