LONDON (Reuters) - Standard Chartered has set up a board committee responsible for financial crime compliance, a day after U.S. authorities extended monitoring of the bank by three years.
Standard Chartered said on Wednesday its new Board Financial Crime Risk Committee (BFCRC) will be chaired by Simon Lowth, who has been a non-executive director at the bank since May 2010 and is BG Group's finance director.
The new committee will assume responsibility from next month for policies, procedures, systems and controls for anti-money laundering, sanctions compliance, and the prevention of bribery, corruption and tax crime.
U.S. prosecutors said on Tuesday they had extended a deferred prosecution deal with the bank until December 2017, whereby they will monitor compliance with government sanctions and could hit the bank with harsher penalties.
The original deferred prosecution agreement, due to expire on Wednesday, was struck after the London-based bank was fined $667 million in 2012 over violations related to U.S. sanctions on Iran and other countries.
Banks are under intense pressure to improve their scrutiny of potential financial crime and many have hired hundreds of compliance staff and spent tens of millions of dollars to do so, after U.S. authorities imposed massive fines for wrong-doing.
Standard Chartered, which makes more than three-quarters of its profits in Asia, was rocked by the original fine for breaching sanctions and has had a series of problems since, heaping pressure on Chief Executive Peter Sands.
The bank said the new U.S. deal acknowledged its steps to implement more rigorous internal policies and procedures, staff training, hiring of compliance staff and the blocking of payments for some countries.
Four more of the bank's independent directors, Christine Hodgson, Naguib Kheraj, Ruth Markland and Lars Thunell, will join Lowth on the committee, along with at least three external advisors with expertise in combating financial crime.
The bank also appointed nine senior executives to its Financial Crime Compliance (FCC) operations, based in London, Newark, Dubai, Singapore and Johannesburg, adding to the appointment in August of John Cusack as global head of FCC.
The new appointments include Patricia Sullivan, previously deputy global head of anti-money laundering compliance for UBS, as head of FCC for the Americas; and Hui Chen, previously in compliance at drugs firm Pfizer and a past federal prosecutor with the U.S. Attorney's Office in New York, as head of anti-bribery and corruption compliance.
Standard Chartered's shares were down 1 percent at 935 pence by 0500 ET, underperforming a flat European bank index.
Reporting by Simon Jessop and Steve Slater; editing by David Clarke