Standard Chartered Bank to Pay $300 Million as Part of Settlement for Inadequate Anti-Money Laundering Compliance
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iStock Editorial/Thinkstock(NEW YORK) — The New York State Department of Financial Services (NYDFS) announced new consequences on Tuesday related to Standard Chartered Bank’s failure to resolve anti-money laundering compliance problems in connection with a 2012 settlement.
According to an independent compliance monitor, SCB, “failed to detect a large number of potentially high-risk transactions for further review.” Many of those transactions originated from the bank’s Hong Kong subsidiary or branches within the United Arab Emirates.
SCB had, the NYDFS says, created a rulebook to help its branches and subsidiaries to detect high-risk transactions, which was later determined to have errors and other problems. As such, SCB failed to identify high-risk transactions that required further review.
Under the new NYDFS order, SCB will suspend dollar clearing operations for high-risk retail business clients at SCB Hong Kong and will exit high-risk transactions for small and medium business clients at SCB UAE. The company will also pay a $300 million penalty, cease opening new U.S. Dollar demand deposit accounts, provide a new comprehensive remediation plan, and implement other activities to prevent similar issues from continuing in the future.
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