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For UNI and its finance affiliates, the revelations about StanChart's illegal practices with Iran is shedding light onto the lack of transparency in the banking sector, adding to the already long list of scandals that have been hitting the UK banks since the beginning of the financial crisis. There is an urgent need to implement effective anti-money laundering legislations to restore public trust in financial institutions.

More about StanChart scandal:

Standard Chartered has agreed to pay $340m to New York state to settle accusations it hid from regulators at least $250bn in transactions with Iran and potentially violated US sanctions policy. While the agreement settles New York’s accusations, it does not end long-running investigations into StanChart’s activities begun by other US authorities over the bank’s alleged violations of US sanctions policy towards Iran.

The US Treasury, the Department of Justice, the Federal Reserve and the Federal Bureau of Investigation are also probing the bank’s transactions with Iran. The DFS, run by Benjamin Lawsky, called StanChart a “rogue institution” and threatened to revoke its licence to operate in the state due to the alleged violations. Mr Lawsky has since come under fire from other US authorities, who complained that the agency had been unnecessarily aggressive towards the bank. In its August 6 order against the bank, the DFS said: “Motivated by greed, [StanChart] acted for at least 10 years without any regard for the legal, reputational and national security consequences of its flagrantly deceptive actions.Led by its most senior management, [StanChart] designed and implemented an elaborate scheme by which to use its New York branch as a front for prohibited dealings with Iran – dealings that indisputably helped sustain a global threat to peace and stability.”

The bank strongly denied most of the DFS’s claims but admitted that a small number of its transactions with Iran violated US policy.

In its deal with the DFS, StanChart agreed to on-site monitoring by state regulators as well as an outside monitor who will keep watch over the bank’s anti-money laundering activities for two years and report to state officials rather than bank executives.

ING, the Dutch bank, was fined $619m for sanctions breaches earlier this year, while HSBC has set aside $700m to cover expected fines for money laundering violations and sanctions failures. Since 2009, Credit Suisse, Lloyds and Barclays have each paid fines in the hundreds of millions of dollars to resolve allegations they broke US sanctions law.