Standard Chartered confirms final charge of $186m to resolve legacy conduct and control issues

The Group has incurred monetary penalties totalling $1.1 billion to resolve legacy conduct and control issues that resulted in a further and final charge of $186 million in the quarter to end-March 2019.

Standard Chartered PLC (LON:STAN) has earlier today published its Interim Management Statement for the quarter ended March 31, 2019, with the report containing a brief update on the provision dedicated to resolve legacy conduct and control issues. 

In line with previous announcements, the Group says today it has incurred monetary penalties totalling $1.1 billion to resolve legacy conduct and control issues. These have resulted in a further and final charge of $186 million in addition to the $900 million provision in 2018.

Commenting on the first quarter performance, Bill Winters, Group Chief Executive, said:

“The first quarter demonstrated our determination to deliver the refreshed strategic priorities at pace. We announced a number of digital initiatives across Hong Kong, Africa and India aimed at growing our customer base and enhancing our services. Our first quarter profit supports our belief that we will generate full-year returns of at least 10% by 2021. The resolution of our legacy conduct and control issues means we can now manage our capital position more dynamically. We will maintain our strategic investment programme and start to buy back $1 billion of our shares, reflecting our confidence in our ability to execute the strategy and create long-term shareholder value.”

Earlier in April, Standard Chartered said it would pay a total of $947 million in monetary penalties to a number of U.S. Agencies and £102 million to the UK Financial Conduct Authority in order to resolve the previously disclosed investigations by the U.S. Department of Justice (DOJ), the Office of the District Attorney for New York County (DANY), the New York State Department of Financial Services (DFS), the Board of Governors of the Federal Reserve System and the U.S. Treasury’s Office of Foreign Assets Control and the FCA into its historical sanctions compliance and financial crime controls.

The resolutions include no new compliance monitorships and the monitorships previously imposed by the DFS and the DOJ were terminated on December 31, 2018 and March 31, 2019, respectively.

Standard Chartered stresses that it has cooperated proactively and fully with the authorities’ investigations. The Group has also conducted its own thorough accountability review and shared the results with the authorities.

The Group says that since 2012 it has made substantial investments in its financial crime compliance program and increased related headcount six-fold. It adds that it has made extensive changes to its Board, senior management and governance and established a Board Financial Crime Risk Committee, whose members include independent non-executive directors and external advisors with backgrounds in law enforcement and national security.

Source: financefeeds.com