Standard Chartered pays $327M in U.S.-Iran transfers case

Dec. 10 (Bloomberg) -- Standard Chartered Plc, Britain’s second-largest bank by value, agreed to pay $327 million of fines relating to transactions with Iranian clients that may have violated U.S. sanctions.

After agreeing to pay a $340 million settlement to New York’s Department of Financial Services, the lender agreed the fines with the Federal Reserve Board, U.S. Department of Justice, the U.S. Treasury Department and the District Attorney for New York County.

The fines are in line with the amount the lender told investors it expected to pay on Dec. 6. The lender will pay $100 million to the Federal Reserve and $227 million to the U.S. Department of Justice and the District Attorney for New York County. The settlement includes a $132 million fine to the Treasury Department’s Office of Foreign Assets Control, according to a statement from the Federal Reserve today.

“The orders address unsafe and unsound practices related to inadequate and incomplete responses to examiner inquiries as well as insufficient oversight of its compliance program for U.S. economic sanctions, Bank Secrecy Act, and anti-money- laundering requirements,” the Fed said in the statement.

Standard Chartered in August was accused by Benjamin Lawsky, head of the New York Department of Financial Services, of helping Iran launder about $250 billion in violation of federal laws, keeping false records and handling lucrative wire transfers for Iranian clients. The bank sent them through its New York unit in so-called U-turn transactions with client names omitted to hide their provenance, Lawsky said. The bank settled the probe on Aug. 14, a day before it was due to defend itself to the regulator.

The New York settlement amount was 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.

HSBC Holdings Plc said on Nov. 5 it’s likely to face criminal charges from U.S. anti-money-laundering probes and the cost of a settlement may “significantly” exceed the $1.5 billion the bank has set aside.

HSBC has been in talks with U.S. regulators over allegations it laundered funds of sanctioned nations including Iran and Sudan. The probes prompted Standard & Poor’s to question whether the lender, Europe’s largest by market value, is too big to be managed effectively.