Standard Chartered Rejects U.S. Iran Deals Charges

UK-based Standard Chartered Plc has rejected U.S. regulators’ accusations that it laundered $250 billion from the Iranian authorities despite sanctions imposed on the Islamic Republic, the bank said on Tuesday.

“Standard Chartered PLC strongly rejects the position and portrayal of facts made by the New York State Department of Financial Services,” the bank said in a statement.

Western media reported on Monday the New York State Department of Financial Services (DFS) accused Standard Chartered, which the agency called a “rogue institution,” of masking more than 60,000 transactions for Iranian banks and corporations, motivated by the millions of dollars it reaped in fees.

“Using its New York-based operations, a major British bank schemed with the Iranian government for nearly a decade to launder $250 billion, leaving the United States financial system vulnerable to terrorists and corrupt regimes,” The New York times wrote.

Senior management at the 150-year-old bank used the New York branch as a front for prohibited dealings with Iran, indisputably helping sustain a global threat to peace and stability, a regulatory order DFS sent to the bank said.

The order requires the UK bank to explain its apparent violations of law in a hearing later this month, and justify why its operating license in New York should not be revoked.

The bank’s stock fell 21 percent in London on Tuesday compared with Monday’s close, wiping around $18 billion off its value, The Guardian reported on Tuesday.

Standard Chartered vehemently denies the regulators’ charges.

“In January 2010, the Group voluntarily approached all relevant U.S. agencies, including the DFS, and informed them that we had initiated a review of historical U.S. dollar transactions and their compliance with US sanctions. This review focused primarily on transactions relating to Iran in the period 2001-2007, and in particular, their compliance with the U-turn framework established by the US authorities to enable ongoing US dollar trade with Iran by other countries,” the bank said.

“The Group believes that the interpretation reflected in the DFS’ order, of the U-Turn exemption — a federal regulation administered and enforced by federal authorities — is incorrect as a matter of law. The Group’s review of its Iranian payments also 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 organization.”

 

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