Deloitte, NY settle over review of Standard Chartered money laundering

Tue Jun 18, 2013 3:14pm EDT
 
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By Karen Freifeld

NEW YORK (Reuters) - A financial advisory unit of Deloitte LLP has agreed to pay $10 million and accept other New York state penalties to settle accusations of misconduct related to an investigation of money laundering at Standard Chartered Bank.

Deloitte Financial Advisory Services also agreed to a one-year ban on doing consulting work for financial institutions regulated by New York state, and to reforms designed to address conflicts of interest, the state Department of Financial Services said on Tuesday.

The head of the state regulator said the case was just the start of a crackdown "investigating and reforming the consulting industry."

The agreement only applies to Deloitte's financial services advisory group, which is separate from its auditing arm.

In August, Standard Chartered agreed to pay New York $340 million for breaking U.S. sanctions against Iran and other countries. Last December, it agreed to another $327 million to resolve similar allegations by other U.S. agencies.

Deloitte, which was working as a consultant to Standard Chartered, omitted critical information in a report to regulators on its independent review of the bank, the Department of Financial Services said. The department oversees New York banks and New York branches of foreign banks.

The agency said Deloitte also violated New York banking law giving Standard Chartered confidential reports involving suspicious activity the firm had prepared for other client banks.

The settlement agreement said the regulator found no evidence the consultant intentionally helped or conspired with the bank to launder money. In August, it had said the unlawful conduct by Standard Chartered was "apparently aided" by Deloitte.   Continued...

 
The Deloitte Company logo is seen on a commercial tower at Gurgaon, on the outskirts of New Delhi August 9, 2012. REUTERS/Parivartan Sharma