Standard Chartered in talks to settle Iran laundering probe

Mon Aug 13, 2012 7:32pm EDT
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By Karen Freifeld and Matt Scuffham

NEW YORK/LONDON (Reuters) - Standard Chartered Plc said on Monday it was in talks with New York's banking regulator to try to settle allegations it hid transactions with Iran.

The two sides have been negotiating ahead of a hearing set for Wednesday at which the bank must demonstrate why its state banking license should not be revoked over the transactions.

Last week, state Financial Services Superintendent Benjamin Lawsky said the bank hid Iran-linked transactions with a total value of $250 billion.

Standard Chartered Chief Executive Peter Sands has denied Lawsky's allegations and said the total amount that failed to adhere to U.S. sanctions on Iran was less than $14 million.

A bank spokeswoman said negotiations were continuing, but she declined to give details. "We're still trying to reach a settlement," the spokeswoman said.

New York's Department of Financial Services declined to comment.

The size of the settlement was fluid and subject to negotiation. Also, the talks could still collapse and Wednesday's hearing could be postponed to allow more time for negotiation.

A person familiar with the situation, who spoke on condition of anonymity because of not being authorized to speak about the matter, said that Lawsky was seeking a settlement of about $350 million. Another person with knowledge of the situation said the figure had dropped to $250 million.   Continued...

Employees of Standard Chartered leave a branch of the bank in central Seoul August 9, 2012. REUTERS/Lee Jae-Won