US regulators have accused British bank, Standard Chartered, of behaving like a “rogue institution” and of laundering $250 billion from Iran, hiding the transactions for over a decade, a violation of US sanctions.

Yesterday, New York state’s Department of Financial Services (DFS) claimed that the US branch of the British bank had earned millions in fees following in excess of 60 000 “secret transactions” with the sanctioned state. It also said that the disgraced institution had left the US financial system “vulnerable to terrorists, weapons dealers, drug kingpins and corrupt regimes”. The DFS went on to say that the “flagrantly deceptive actions” had been “motivated by greed” and the bank has since been threatened with having its US banking licence revoked.

“For almost 10 years, SCB schemed with the government of Iran and hid from regulators roughly 60 000 secret transactions, involving at least $250bn,” the regulator claimed.

Standard Chartered have denied the accusations and claim that reports had been manipulated.

“[Standard Chartered] strongly rejects … the portrayal of facts as set out” by the DFS.

“The group does not believe the order issued by the DFS presents a full and accurate picture of the facts,” said group secretary Annemarie Durbin.

The accusations, if proven, could prove to be a fatal blow for the bank, which was the only UK institute to emerge from the 2008 crisis with “its reputation for financial prudence intact.”

Despite Standard Chartered’s denial of guilt, it was reported that the transactions, most of which involved monetary transfers for state-owned Iranian banks, were sanctioned by the “most senior management.” The DSF also reported that one senior director had reacted rather rashly when warned of US sanctions, saying,

“You f***ing Americans. Who are you to tell us, the rest of the world, that we’re not going to deal with Iranians?”

The DSF’s accusations, which involved going through more than 30 000 pages of documents, are the result of a nine-month inquiry which was led by Benjamin Lawsky, the Superintendent of the New York Department of Financial Services. Evidence was also found of possible transactions Libya, Burma and Sudan, all which have also fallen subject to US sanctions.

The bank said that it had stopped all new business with Iranian partners over five years ago and that the DSF “did not identify a single payment on behalf of any party that was designated at the time by the US government as a terrorist entity or organisation”.

Standard Chartered has been ordered to explain the “apparent violations of law” and demonstrate why its licence to operate in New York should not be revoked.

[Source: The Independent, News24]