US feds 'surprised' by NY case vs StanChart
By Staff Reporter
AFP American Edition
Aug 08, 2012
US federal regulators were surprised by New York state's stunning charges that Standard Chartered Bank illegally laundered $250 billion for Iranian banks, The New York Times reported Wednesday.
The charges by the New York Department of Financial Services (DFS) Monday that the London-based bank hid the transactions, violating US sanctions on Tehran, were not endorsed by the US Justice Department, the Federal Reserve, and the US Treasury, the Times said.
While all were involved in investigating the bank's handling of US dollar transfers for state-owned Iranian banks over a 10-year period, they differed on the size of the wrongdoing.
And they were upset that DFS head Benjamin Lawsky went ahead with public accusations without them.
"Before Monday, these authorities were not expecting Mr. Lawsky to act," the Times said, citing people close to the case.
"In money laundering cases, authorities almost always move in concert. Lawsky's order against Standard Chartered irked many of the other regulators, who questioned whether he had moved too quickly."
Standard Chartered has strongly rejected the accusations of the DFS, which threatened to withdraw the bank's license to operate in New York, the hub of US banking, and could lead to huge fines.
The bank said it has been cooperating with all of the regulators, voluntarily approaching them over the matter and providing massive documentation of its activities.
It said in a statement Monday that only $14 million worth of transactions -- so-called U-turn deals which moved US dollars between clients through Standard Chartered's New York dollar clearing unit -- did not follow US rules.
Citing unnamed sources, the Times said that Treasury Department officials believe as well that many of the transactions, while questionable, "were not necessarily illegal."
Moreover, both the Justice Department and the Fed had still been reviewing the evidence and had not decided on whether to bring charges.
But the New York regulator said it had evidence that bank executives had schemed between 2001 and 2010 to mask massive amounts of the transfers from US regulators.
The DFS said it had evidence not only of illegal transfers for Iran but also for Libya, Myanmar and Sudan while those countries were under US sanctions as well.
The DFS branded the global finance giant a "rogue bank" that "left the US financial system vulnerable to terrorists, weapons dealers, drug kingpins and corrupt regimes."
By Staff Reporter
AFP American Edition
Aug 08, 2012
US federal regulators were surprised by New York state's stunning charges that Standard Chartered Bank illegally laundered $250 billion for Iranian banks, The New York Times reported Wednesday.
The charges by the New York Department of Financial Services (DFS) Monday that the London-based bank hid the transactions, violating US sanctions on Tehran, were not endorsed by the US Justice Department, the Federal Reserve, and the US Treasury, the Times said.
While all were involved in investigating the bank's handling of US dollar transfers for state-owned Iranian banks over a 10-year period, they differed on the size of the wrongdoing.
And they were upset that DFS head Benjamin Lawsky went ahead with public accusations without them.
"Before Monday, these authorities were not expecting Mr. Lawsky to act," the Times said, citing people close to the case.
"In money laundering cases, authorities almost always move in concert. Lawsky's order against Standard Chartered irked many of the other regulators, who questioned whether he had moved too quickly."
Standard Chartered has strongly rejected the accusations of the DFS, which threatened to withdraw the bank's license to operate in New York, the hub of US banking, and could lead to huge fines.
The bank said it has been cooperating with all of the regulators, voluntarily approaching them over the matter and providing massive documentation of its activities.
It said in a statement Monday that only $14 million worth of transactions -- so-called U-turn deals which moved US dollars between clients through Standard Chartered's New York dollar clearing unit -- did not follow US rules.
Citing unnamed sources, the Times said that Treasury Department officials believe as well that many of the transactions, while questionable, "were not necessarily illegal."
Moreover, both the Justice Department and the Fed had still been reviewing the evidence and had not decided on whether to bring charges.
But the New York regulator said it had evidence that bank executives had schemed between 2001 and 2010 to mask massive amounts of the transfers from US regulators.
The DFS said it had evidence not only of illegal transfers for Iran but also for Libya, Myanmar and Sudan while those countries were under US sanctions as well.
The DFS branded the global finance giant a "rogue bank" that "left the US financial system vulnerable to terrorists, weapons dealers, drug kingpins and corrupt regimes."