Whistleblowers have claimed Standard Chartered allegedly carried out billions of dollars of previously undetected transactions for Iran-linked entities and terrorist organisations, according to a New York court filing.
Two whistleblowers, who include a former executive at the British bank, filed a motion last week to set aside a judgment that dismissed an earlier lawsuit they filed, in an attempt to revive their efforts.
The two men, who run Brutus Trading, which was formed to pursue their claim, said in court papers that their lawsuit should be reinstated after they used forensic data analysis to “decloak” information “hidden deep in the bank’s electronic spreadsheets”.
The data was provided by Brutus to US authorities in 2012 and 2013 and the whistleblowers claim it shows “countless illegal transactions” by the bank. Standard Chartered denies the allegations.
The whistleblowers – Julian Knight, a former global head of foreign exchange transaction banking who left Standard Chartered in 2011, and Robert Marcellus, a currency trader – were helped by the forensic investigator David Scantling, who began examining the data, and worked together to reveal “transactions that were hidden”, the court documents claim.
By February 2024, the men alleged they had “identified over 3.3m previously undisclosed transactional records, of which 500,000 documented unique transactions spanning from 2008 to 2013”.
The court documents said that the data showed 20,000 foreign exchange transactions related to Iran that took place between 2008 and 2013 and had a cumulative notional value of $100bn (£78bn).
“The decloaked … data definitely shows that – long after the bank supposedly discontinued its Iranian operations in 2007 – SCB [Standard Chartered Bank] facilitated many billions of dollars in banking transactions for Iran, numerous international terror groups and the front companies for those groups,” the court papers filed by the two whistleblowers to New York’s southern district court last week allege.
In a declaration by Scantling lodged with the court, the investigator states that, as well as identifying 3.3m previously undisclosed transactional records, he had “further isolated 906 Iranian-related transactions” between January 2008 and March 2012 which totalled $9.6bn and involved “entities and individuals subject to international sanctions”.
He claimed the newly extracted data included numerous Standard Chartered transactions “with and on behalf of Iranian banks, Iranian companies and Middle Eastern money exchanges” that according to the US government “finance designated foreign terrorist organisations” such as Hezbollah, Hamas and the Taliban.
The two whistleblowers also allege that the US government committed a “colossal fraud” on the court when it failed to provide evidence to help enforcement action against the bank for violating global sanctions.
Standard Chartered said in a statement: “This filing is another attempt to use fabricated claims against the bank, following previous unsuccessful attempts.
“The false allegations underpinning it have been thoroughly discredited by the US authorities who undertook a comprehensive investigation into the claims and said they were ‘meritless’ and did not show any violations of US sanctions. We are confident the courts will reject these claims, as they have already done repeatedly.”
The UK government, including the then chancellor George Osborne, intervened with US government on the bank’s behalf in 2012 when the scandal first emerged. The bank admitted breaching sanctions against Iran and other countries – first in 2012 and then in 2019 – paying $1.7bn of fines to regulators, but it has never admitted conducting transactions for terrorist organisations.
Source » theguardian