Why do we need to care about the scandal Standard Chartered is happening far away in America?
Standard Chartered is a world-class bank, based in London. It is important for us to understand what happened because this bank is now focusing its business in Asia and developing countries. Thus, any scandal that might befall Stanchart will affect the future of the bank's business in the future.
Okay, but what the heck he had done so in the scandal?
One of the banking regulator in New York that the Department of Financial Services (DFS) pointed StandChart surreptitiously running a business unit in cooperation with the Iranian government. Through the unit, StandChart has conducted more than 250 billion dollars in illegal transactions for nearly a decade.
DFS allegations in a report like this:
"For almost 10 years, [Standard Chartered] with the Iranian government deliberately concealed approximately 60,000 transactions secret from the regulator, involving about 250 billion U.S. dollars, and reap millions of dollars in fees. Standard Chartered makes the action of the U.S. financial system vulnerable to terrorists, arms dealers, drug mafias, and corrupt regimes, as well as blocking the investigators to obtain important information to track criminal activity. "
DFS said Stanchart run a wire-stripping.
Wire-stripping?
The process of changing the code to hide the bank where the transaction originated. Often, by replacing the swift code the code that identifies a bank. The report pointed out that DFS following StandChart manual also explains how to do this to employees:
"Make sure that the column number 52 for the payments not be filled or not written any swift code to '_' ... (Note: if this is not done, then the Iranian bank swift code will appear - depending on the route - in payment messages sent [to branches of New York]). "
These allegations are similar to money laundering charges on HSBC and Barclays are also similar violations in 2010. Is it the same?
They are similar, but there are also major differences.
Which is?
Unlike HSBC and Barclays, Standard Chartered rejected the allegations. In a statement, said "categorically rejects the depiction of the facts which created the Department of Financial Services New York State".
Stanchart explained that the financial report has also stressed that he has done a review of the bank's compliance historically, and has been discussed by various U.S. government agencies, including DFS, the Department of Justice, Office of Foreign Assets Control, New York Federal Reserve Group, and the district attorney's New York since January 2010.
Standard Chartered also said that he "did not believe it describes the DFS commands a full and accurate facts. Analysis of compliance submitted to government agencies also showed that in this period our group meets, including not violating U.S. sanctions against Iran and the relevant regulations of payment u-turn. As we have revealed to the authorities, 99.9 per cent of all transactions with respect to Iran comply with the regulation of u-turn. Total value of transactions that do not follow the u-turn under U.S. 14 million dollars. "
Briefly. U-turn is what again?
Until November 2008, the U.S. Office of Foreign Assets Control has been set that the U.S. financial institutions, under certain circumstances and under strict supervision of the regulator, may process certain transactions for Iranian banks, individuals and other entities. Regulas appropriate federal, state in question is that the transactions carried out abroad by non-Iranian foreign bank, and only through the U.S. financial system to non-Iranian foreign bank other.
Standard Chartered is a world-class bank, based in London. It is important for us to understand what happened because this bank is now focusing its business in Asia and developing countries. Thus, any scandal that might befall Stanchart will affect the future of the bank's business in the future.
Okay, but what the heck he had done so in the scandal?
One of the banking regulator in New York that the Department of Financial Services (DFS) pointed StandChart surreptitiously running a business unit in cooperation with the Iranian government. Through the unit, StandChart has conducted more than 250 billion dollars in illegal transactions for nearly a decade.
DFS allegations in a report like this:
"For almost 10 years, [Standard Chartered] with the Iranian government deliberately concealed approximately 60,000 transactions secret from the regulator, involving about 250 billion U.S. dollars, and reap millions of dollars in fees. Standard Chartered makes the action of the U.S. financial system vulnerable to terrorists, arms dealers, drug mafias, and corrupt regimes, as well as blocking the investigators to obtain important information to track criminal activity. "
DFS said Stanchart run a wire-stripping.
Wire-stripping?
The process of changing the code to hide the bank where the transaction originated. Often, by replacing the swift code the code that identifies a bank. The report pointed out that DFS following StandChart manual also explains how to do this to employees:
"Make sure that the column number 52 for the payments not be filled or not written any swift code to '_' ... (Note: if this is not done, then the Iranian bank swift code will appear - depending on the route - in payment messages sent [to branches of New York]). "
These allegations are similar to money laundering charges on HSBC and Barclays are also similar violations in 2010. Is it the same?
They are similar, but there are also major differences.
Which is?
Unlike HSBC and Barclays, Standard Chartered rejected the allegations. In a statement, said "categorically rejects the depiction of the facts which created the Department of Financial Services New York State".
Stanchart explained that the financial report has also stressed that he has done a review of the bank's compliance historically, and has been discussed by various U.S. government agencies, including DFS, the Department of Justice, Office of Foreign Assets Control, New York Federal Reserve Group, and the district attorney's New York since January 2010.
Standard Chartered also said that he "did not believe it describes the DFS commands a full and accurate facts. Analysis of compliance submitted to government agencies also showed that in this period our group meets, including not violating U.S. sanctions against Iran and the relevant regulations of payment u-turn. As we have revealed to the authorities, 99.9 per cent of all transactions with respect to Iran comply with the regulation of u-turn. Total value of transactions that do not follow the u-turn under U.S. 14 million dollars. "
Briefly. U-turn is what again?
Until November 2008, the U.S. Office of Foreign Assets Control has been set that the U.S. financial institutions, under certain circumstances and under strict supervision of the regulator, may process certain transactions for Iranian banks, individuals and other entities. Regulas appropriate federal, state in question is that the transactions carried out abroad by non-Iranian foreign bank, and only through the U.S. financial system to non-Iranian foreign bank other.
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