Standard Chartered Signs $340 Million N.Y. Probe Accord
Under the accord, the London-based bank also agreed to install a monitor for two years, according to a statement today from Benjamin Lawsky, head of the New York Department of Financial Services. Lawsky said his agency will “continue to work with our federal and state partners on this matter.”
Regulators including the U.S. Treasury, the Federal Reserve Bank, the Justice Department and the Manhattan district attorney continue to work on a comprehensive agreement involving the transfers, which involved $250 billion over a six-year period.
The bank “continues to engage with the other U.S. agencies on their review of the Group’s historical U.S. sanctions compliance,” Standard Chartered said today in a separate statement, referring to itself as “the Group.” Standard Chartered said it “cannot predict when this review and these discussions will be completed or what the outcome will be and therefore potential liabilities cannot be reasonably quantified at this point.”
As part of the agreement, the bank will hire people in its New York branch to oversee and audit anti-money-laundering procedures.
On Aug. 6, Lawsky, 42, issued an order accusing Standard Chartered of helping Iran launder about $250 billion in violation of federal laws. One analyst estimated that the loss of the bank’s New York license could result in a 40 percent drop in earnings. Standard Chartered generates almost 90 percent of its profit and revenue in Asia, Africa and the Middle East.
The settlement amount is the largest ever paid to an individual regulator as part of a money-laundering accord. In June, ING Bank NV agreed to pay $619 million to settle similar allegations. That sum was split evenly between the federal government and the Manhattan district attorney’s office.
The DFS was created in 2011 when New York’s Banking Department and Insurance Department were abolished, with their functions and authority transferred to the new regulator, under Lawsky. The agency has the power to issue regulations, as well as investigate and fine financial services companies. It may also probe alleged criminal activity and refer its findings to the state’s attorney general for prosecution.
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