Standard Chartered May Lose NY Licence Over Iran Ties

Standard Chartered, a financier in emerging markets, is the sixth foreign bank since 2008 to be implicated in dealings with sanctioned countries such as Iran in investigations led by federal and New York law-enforcement officials.

Four banks — Barclays Plc, Lloyds Banking Group, Credit Suisse Group and ING Bank NV — have agreed to fines and settlements totaling $1.8 billion. HSBC Holdings Plc currently is under investigation by US law enforcement, according to bank regulatory filings.

The New York regulator, headed by former prosecutor Benjamin Lawsky, ordered Standard Chartered to explain why the bank should not lose its state license and the ability to process dollar transactions. Lawsky also ordered the bank to bring in an outside consultant to monitor its transactions.

“Standard Chartered Bank operated as a rogue institution,” Lawsky said in the order.

In an unusual move, the regulator also found fault with an outside consultant — Deloitte LLP – – because the firm “apparently aided” the bank in its deception.

In a statement on Monday, Deloitte said its financial advisory service division “performed its role as independent consultant properly and had no knowledge of any alleged misconduct by bank employees. Allegations otherwise are unsupported by the facts.”

Standard Chartered, founded in 1853, is headquartered in London, but it specialises in financing in Asia, Africa and the Middle East.

Standard Chartered’s stock fell eight per cent in the final 15 minutes of trading in London amid reports of the US probe. Standard Chartered shares closed down 6.2 per cent at 14.70 pounds ($22.91).

Chairman John Peace, CEO Peter Sands and Finance Director Richard Meddings could not be reached for comment, and the bank declined to comment beyond its brief statement.