A British bank, Standard Chartered, is alleged to have facilitated billions of dollars in transactions for funders of terrorist groups, according to US court papers. The bank, one of the UK’s largest, avoided prosecution for money laundering in 2012 after intervention from Lord Cameron’s government.
New documents filed in a New York court reveal that from 2008 to 2013, Standard Chartered conducted thousands of transactions worth over $100 billion in violation of sanctions against Iran. An independent expert identified $9.6 billion in foreign exchange transactions involving individuals and companies designated by the US government as financiers of terrorist groups, including Hezbollah, Hamas, al-Qaeda, and the Taliban.
Standard Chartered disputes these claims, stating that previous allegations were “thoroughly discredited” by US authorities. The bank was publicly accused of falsifying transaction data on Swift, an international payment system, to move billions of dollars through its New York branch on behalf of sanctioned entities such as the Central Bank of Iran.
In September 2012, then-Chancellor George Osborne intervened on the bank’s behalf. Subsequently, the US Department of Justice decided not to prosecute, although it is not suggested that Osborne or Lord Cameron were aware of the transactions at that time. Standard Chartered admitted to breaching sanctions in 2012 and 2019, paying fines totalling more than $1.7 billion, but has not admitted to conducting transactions for terrorist organizations.
Confidential spreadsheets, first handed to US authorities in 2012 by whistleblowers including former Standard Chartered executive Julian Knight, detailed these transactions. Whistleblowers allege that US government agencies made false statements to dismiss their claim for a whistleblower’s reward. In 2019, US authorities successfully applied to have the case dismissed, with an FBI agent claiming there was no indication of improper transactions post-2007.
However, an independent analysis by David Scantling, an expert in counter-terrorist financing, contradicts these claims. His court declaration indicates over half a million transactions between 2008 and 2013 were “cloaked” and could be extracted through well-known analytical techniques. The transactions included dealings with Iranian banks and Middle Eastern money exchanges financing designated terrorist organizations.
Scantling’s analysis also identified transactions involving a Pakistani fertilizer company, Fatima Fertiliser, linked to explosives used by the Taliban, and 73 transactions for a Gambian front company owned by Hezbollah financier Mohammad Ibrahim Bazzi.
Daniel Alter, former general counsel at the New York Department of Financial Services, described the new disclosures as “shocking” and “exponentially worse” than previously admitted. He highlighted the connection to terrorist organizations as a regulator’s nightmare, noting these details were not disclosed in prior data.
In 2012, George Osborne wrote to US officials including Federal Reserve Chair Ben Bernanke and Treasury Secretary Tim Geithner, and met them the following month. Two months later, the bank was fined $300 million but escaped prosecution through a deferred prosecution agreement (DPA). No individual bank executives were prosecuted. In 2019, Standard Chartered agreed to a further DPA for transactions between 2007 and 2011 and was fined an additional $1.1 billion.
Both the FBI and US Department of Justice declined to comment on the recent filings. Standard Chartered expressed confidence that the courts would reject the whistleblowers’ claims, which US authorities previously deemed “meritless.” The whistleblowers, however, assert that US authorities committed “a colossal fraud” by denying the existence of critical evidence.
Neither Lord Cameron nor George Osborne provided comments on the record.
