(Adds bank comment, settlement terms, background, bylines)
By Jonathan Stempel and Steve Slater
NEW YORK Aug 19 British banking company
Standard Chartered Plc will pay a $300 million penalty
and suspend or exit some important businesses after failing to
weed out risky transactions that could be linked to money
The civil settlement announced on Tuesday by Benjamin
Lawsky, the New York State financial services superintendent,
came two years after Standard Chartered agreed to pay $667
million to a variety of U.S. regulators to resolve similar
charges, including $340 million to Lawsky's office.
A monitor appointed in 2012 uncovered shortcomings in the
bank's surveillance systems that caused a "significant number of
potentially high-risk transactions" to go undetected, according
to a consent order signed by Peter Sands, Standard Chartered's
chief executive officer.
"If a bank fails to live up to its commitments, there should
be consequences," Lawsky said in a statement. "That is
particularly true in an area as serious as anti-money-laundering
compliance, which is vital to helping prevent terrorism and vile
human rights abuses."
The latest settlement calls for Standard Chartered's New
York branch to suspend the processing of dollar-denominated
payments, known as dollar clearing, for high-risk business
clients at its Hong Kong unit.
Standard Chartered will also end high-risk small- and
mid-sized business client relationships in the United Arab
Emirates, and obtain approval from Lawsky's office before
opening U.S. dollar-clearing accounts for new clients. It will
also retain a monitor for another two years.
In a statement, Standard Chartered said it "accepts
responsibility for and regrets the deficiencies" in its
anti-money laundering surveillance system in New York, and is
committed to fix the problems with "utmost urgency."
It also said it "remains fully committed" to the Hong Kong
and UAE markets, and that the vast majority of its clients and
businesses, as well as its U.S. licenses, are unaffected.
The bank is based in London but makes most of its money in
Asia, Africa and the Middle East.
Its monitor is Ellen Zimiles, a Navigant Consulting Inc
managing director and former federal prosecutor.
Standard Chartered's earlier settlement with Lawsky resolved
charges that it concealed an estimated $250 billion of
transactions linked to Iran, violating U.S. sanctions.
U.S. regulators have in recent years also punished other
European banks including Barclays Plc, BNP Paribas SA
, HSBC Holdings Plc and UBS AG for
running afoul of laws against money laundering or doing business
with blacklisted countries.
BNP's $8.83 billion settlement is the largest, but Standard
Chartered's is unusual by making the bank a repeat offender.
Settlement terms are not expected to be material to Standard
Chartered's results, a person familiar with the accord said.
(Reporting by Jonathan Stempel in New York and Steve Slater in
London; Additional reporting by Karen Freifeld in New York;
Editing by Jeffrey Benkoe and Cynthia Osterman)