By Nicolas Parasie
DUBAI--Standard Chartered may face legal action in the United
Arab Emirates brought by clients whose accounts will be closed by
the bank after it was slapped with a $300 million fine related to
alleged lapses in anti-money-laundering controls, the U.A.E.
Central Bank said Thursday.
Standard Chartered's settlement with the New York state
regulator, announced Tuesday, required among other things that the
bank improve its monitoring of certain small and medium-size
business relationships at its U.A.E. locations. The U.A.E. central
bank estimates between 1,400 and 8,000 clients could be
affected.
The central bank said Standard Chartered was liable to legal
action because of the "material and moral damage" company owners
may suffer as a result of having their accounts closed. It said its
consumer protection unit is ready to receive and consider
complaints from the bank's affected customers.
"We have noted the announcement made by the U.A.E. central bank.
We always work with our regulators to achieve the right outcomes,"
a Standard Chartered spokesman in London said.
Earlier this week, Standard Chartered said the bank was already
seeking to reduce its SME activities in the U.A.E. as part of a
broader strategic overhaul and remains committed to the country,
the group's fifth-largest revenue contributor.
Write to Nicolas Parasie at nicolas.parasie@wsj.com
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