Standard Chartered to Pay $327M to Settle Money-Laundering Probes

Standard Chartered Bank will pay $327 million to settle charges that it violated U.S. law by laundering millions of dollars for banks and others in Iran and Sudan.

Under the terms of a series of settlements announced Monday, the British bank will pay $227 million to the U.S. Department of Justice, the Treasury Department and the Manhattan District Attorney's Office, as well as $100 million to the Federal Reserve Board.

The settlements resolve claims that the bank moved funds on behalf of Iranian and Sudanese clients over a roughly six-year period beginning in 2001. The bank also faced claims that it hid information that prevented regulators from determining that the transactions originated with countries that were subject to U.S. sanctions.

U.S. law prohibits banks from providing services to Iran as a result of the country's support for terrorism and its pursuit of weapons of mass destruction. U.S. law also blocks financial dealings with the Sudanese government as a result of that country's human rights violations.

According to the Manhattan District Attorney's Office, Standard Chartered processed U.S. dollar payments on behalf of prohibited customers without reference to the payments' origin, deliberately used a less transparent method of payment messages, eliminated information that would have revealed the source of payments emanating from countries on U.S. sanctions lists, and advised clients how to evade scrutiny by U.S. regulators.

The settlements follow an agreement in August by Standard Chartered to pay $340 million to New York's Department of Financial Services to settle charges that stemmed from an allegedly similar pattern of conduct in connection with transactions that originated in Iran.

"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," Adam Szubin, the director of the Treasury Department's Office of Foreign Asset Control, said in a press release. "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."

A Standard Chartered spokesman did not respond immediately to a request for comment.

The settlement with the Fed requires Standard Chartered to detail plans to ensure compliance with U.S. rules governing money laundering and to prevent violations from recurring.