Shares of the British bank Standard Chartered were sharply lower Tuesday, a day after U.S. officials accused it of illegally laundering $250 billion in financial transactions with Iran during the past decade.
Britain's fifth-biggest bank has operations spread throughout the world, but until now had been spared from a wave of recent disclosures about financial irregularities by British banks. New York's top banking regulator, however, alleged that Standard Chartered "operated as a rogue institution" from 2001 to 2010.
The regulator said the bank earned hundreds of millions of dollars in fees as it filtered money through its New York branch in about 60,000 transactions with Iranian financial institutions. He said the transactions exposed the U.S. banking system to terrorists, drug traffickers and rogue states. The U.S. Federal Bureau of Investigation is conducting a criminal probe.
U.S. bank analyst Bert Ely said the investigation is part of an effort by the U.S. and its Western allies to curb development of Iran's nuclear weapons program, the existence of which Tehran denies.
“Enforcement of the bank secrecy act and the money-laundering laws are just an on-going effort by the financial regulators to again choke off cash flows to Iran as much as possible and make it as difficult as possible for Iran to sell its oil internationally, but also to buy equipment and parts needed for its nuclear enrichment activities,” Ely said.
Standard Chartered said it "strongly rejects" the U.S. allegations and will fight the effort to revoke its license to do business in New York, a key financial center. But its stock plummeted, and the value of the bank plunged nearly 17 percent, a one-day loss of more than $9 billion.
The U.S. government has sharply regulated financial transactions with Iran since 1979, when 52 Americans were held hostage by Tehran for 444 days, and stiffened the rules in recent years as the conflict heightened over Iran's nuclear development program.
Some information for this report provided by AP and AFP.
Britain's fifth-biggest bank has operations spread throughout the world, but until now had been spared from a wave of recent disclosures about financial irregularities by British banks. New York's top banking regulator, however, alleged that Standard Chartered "operated as a rogue institution" from 2001 to 2010.
The regulator said the bank earned hundreds of millions of dollars in fees as it filtered money through its New York branch in about 60,000 transactions with Iranian financial institutions. He said the transactions exposed the U.S. banking system to terrorists, drug traffickers and rogue states. The U.S. Federal Bureau of Investigation is conducting a criminal probe.
U.S. bank analyst Bert Ely said the investigation is part of an effort by the U.S. and its Western allies to curb development of Iran's nuclear weapons program, the existence of which Tehran denies.
“Enforcement of the bank secrecy act and the money-laundering laws are just an on-going effort by the financial regulators to again choke off cash flows to Iran as much as possible and make it as difficult as possible for Iran to sell its oil internationally, but also to buy equipment and parts needed for its nuclear enrichment activities,” Ely said.
Standard Chartered said it "strongly rejects" the U.S. allegations and will fight the effort to revoke its license to do business in New York, a key financial center. But its stock plummeted, and the value of the bank plunged nearly 17 percent, a one-day loss of more than $9 billion.
The U.S. government has sharply regulated financial transactions with Iran since 1979, when 52 Americans were held hostage by Tehran for 444 days, and stiffened the rules in recent years as the conflict heightened over Iran's nuclear development program.
Some information for this report provided by AP and AFP.
