The global banking giant Standard Chartered was being accused by the New York state regarding with covering almost 60,000 hidden transactions with the Iranian government that includes an enormous $250 billion and revealing the United States system to drug kingpins, weapon dealers and terrorists.
All over the world, the UK-based bank has a significant presence and has also been caught that they have deficient money laundering controls in the outsourcing of jobs in India, the New York State Department of Financial Services exposed. According to the New York state department in a 27-page order, the Standard Chartered Bank or SCB comes up with the Government of Iran and protect it to the regulators more or less 60,000 hidden transactions including almost $250 billion and collecting SCB hundreds of millions of dollars in price for almost ten years.
It added that SCB’s plan ditch the United States financial system accessible to corrupt regimes, drug kingpins, weapon dealers, terrorists and dismantled law enforcement investigators with critical information used to follow all manner of criminal activity. In May 2010, SCB had guaranteed the Department that it would take instant corrective solutions on issues recently lifted by the United States Office of Foreign Assets Control or OFAC.
The state department’s last administrative observation in the bank’s New York branch in 2011 that recognized ongoing and significant Banking Secrecy Act/Anti-Money Laundering failures or BSA/AML. The bank was outsourcing its full OFAC agreement process for the New York branch in Chennai, India with no affirmation of any failure or communication within the New York and Chennai offices.
The OFAC is part of the United States Department of Treasury, it is the assigned government agency for setting up list of entities with whom the United States entities and citizens are secured from carrying out business. The other problems were the OFAC compliance system that does not have the ability to distinguish misspellings and divergence of names on the OFAC sanctioned record.
Before the release of funds for transactions with parties whose names the same with the OFAC-sanctioned list, there was no documented proof of that investigation. The order of New York state against the Standard Chartered comes close to the arm of the United States Senate’s Permanent Committee on investigation report that accused other UK-based global bank HSBC of revealing the United States financial System to money laundering and terrorist financing risks. HSBC’s staff in India had come over the scanner for deficiencies in their ethics as offshore reviewers of the global banking giant’s agreement to safety mechanism against terrorist financing and money laundering.
The Senate sub-committee probe exposed that HSBC’s Anti-Money Laundering Compliance Department that involved staff in India was highly insufficiently staffed and failures were discovered in the quality of the work done by HSBC’s offshore reviewers in India who were manipulated for clearing a huge backlog of doubted transaction alerts on the bank. The order against Standard Chartered follows a thorough investigation that included the review of over 30,000 pages of files involving internal SCB emails that distinguished yielding violations of law, said by the New York State Financial Services Department.
REFERENCES:
http://profit.ndtv.com/news/corporates/article-us-state-charges-stanchart-with-250-bn-secret-deals-with-iran-308902
http://timesofindia.indiatimes.com/business/international-business/US-regulator-accuses-Standard-Chartered-of-250bn-secret-deals-with-Iran/articleshow/15380753.cms
http://profit.ndtv.com/news/corporates/article-us-state-charges-stanchart-with-250-bn-secret-deals-with-iran-308902
http://news.outlookindia.com/items.aspx?artid=771236
