The financial fraud issues in which the Standard Chartered Bank (Stand Chart) has been involved prove detrimental to its both image and financial stability. Accordingly, the institution has been subject to legal scrutiny. Recently, Stan Chart was fined $25.41 million for gross violations of the European Union’s sanctions on Russia, which is the heaviest penalty that the Treasury Office of Financial Sanctions and Implementation has ever imposed on an agency (Tokar 2020). The cited literature reports that the penalty was a consequence of several loans that bank advanced to a Turkish bank that had been blacklisted by the European Union for such activity.
The fact that the loans persisted over a long duration was the basis of the institution of the penalty. According to Tokar (2020), the bank advanced 102 loans to the Denizbank AS, the Turkish bank, between 2015 and 2018 despite the existence of a clear stance against the activity by the European Union. As much as some of the loans were permitted, the cited literature indicates that Stan Chart advanced seventy percent of them, averaging an approximated $330.25 million, in breach of the Ukraine-related sanctions by the European Union. The fact that Stand Chart engaged in self-disclosure caused the deciding authority to lower the initial punishment by thirty percent.
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It is also important to note that the bank was subjected to other sanctions for breaching the set financial conditions. In 2019, for example, the bank allowed to pay about $1.1 billion in settlement of allegations that it had breached financial sanctions that the European Union had imposed on Iran as well as other nations. In its defense against the 2019 scrutiny, Stan Chart accepted liability for the breaches, but insisted that two of its former employees had been responsible for the mistake, and that it had instituted measures to ensure that the incidence did not persist.
Reference List
Tokar, D. 2020. Standard Chartered Fined for Violating Russia Sanctions , WSJ . Available at: https://www.wsj.com/articles/standard-chartered-fined-for-violating-russia-sanctions-11585686229 (Accessed: 6 April 2020).
