Standard Chartered Allegations Emblematic of Systemic Money Laundering Orchestrated by International Banking Community

Washington DC, 7 August 2012.

This post was originally published on the Global Financial Integrity website.

Bankers Should Be Held Responsible for their Actions

The allegations levied yesterday by the New York State Department of Financial Services against British banking giant Standard Chartered demonstrate a systemic, widespread pattern of disregard for anti-money laundering policies at one of the world’s biggest banks, according to Global Financial Integrity, a Washington, DC-based research and advocacy organization.

The allegations that Standard Chartered systematically and intentionally stripped information from wire transfers to hide the fact that it was processing U.S. dollar transactions originating from Iran, Libya, Sudan and Burma—in violation of U.S. sanctions—mirror recent charges against international banking giants HSBC and ING and come in the wake of several money laundering lapses at other banks such as Citibank, the former Wachovia bank, and even Standard Chartered, with respect to different violations.

“This is not a problem with one specific bank. This is a systemic problem affecting the entire international banking community,” said Heather Lowe, legal counsel and director of government affairs at GFI.

A study conducted by British regulators last year revealed that seventy-five percent of UK banks investigated were not adequately in compliance with certain anti-money laundering regulations. “There is no reason to believe the situation is any different at American banks,” commented Lowe.

“While banks have faced fines in the wake of recent money laundering cases, it is important to remember that individuals make these decisions, not banks,” continued Lowe. “We need to start holding them legally accountable for the decisions they have made that put people all over the world at risk.”

Lowe notes that following the Wachovia drug money laundering scandal, not one person at the financial institution was even prosecuted, despite the severity of the money laundering infractions that took place. “It is hardly dissuasive when the worst thing that happens to someone caught coordinating a large-scale, international money laundering scheme is that they are moved to a different part of the bank.”


Clark Gascoigne
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