Deloitte implicated in StanChart case
07 August 2012
Deloitte implicated in StanChart case
Allegations that a banking unit of Standard Chartered Plc schemed with Iran to conceal billions of dollars in transactions have dragged Deloitte into the spotlight in another hit to the global accounting and consulting firm.
The New York State Department of Financial Services, in a case involving U.S. anti-money laundering laws, on Monday said Deloitte LLP c o nsultants hid details from regulators about Standard Chartered Bank's transactions with Iranian clients.
The bank's actions "left the U.S. financial system vulnerable to terrorists, weapons dealers, drug kingpins and corrupt regimes," Benjamin Lawsky, superintendent of the department, said in an order made public on Monday.
Deloitte said in a statement: "Deloitte Financial Advisory Services performed its role as independent consultant properly and had no knowledge of any alleged misconduct by bank employees. Allegations otherwise are unsupported by the facts."
The New York Department of Financial Services regulates New York banks and New York branches of foreign banks. It said Standard Chartered's license to operate in the state of New York may be revoked.
The allegations are the latest in a string of setbacks for the U.S. arm of Deloitte, the world's second-largest accounting and consulting firm.
Late last year, Deloitte's U.S. arm came under scrutiny from a member of Congress after audit industry regulators unsealed parts of a report criticizing quality controls at Deloitte's corporate auditing business. Deloitte said at the time that it had made investments to improve its audit practice.
Deloitte consultants separately had overseen a review of HSBC banking transactions after that bank was cited for multiple anti-money laundering failures. ( C) Reuters
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