LONDON—Standard Chartered PLC said Monday it has hired a slew of
top compliance executives, a move that comes as the bank braces for
increased scrutiny of its global sanctions controls from U.S.
officials.
The London-based bank said it has poached Steve Munro as its new
head of sanctions compliance from GE Capital, Duncan Wales will
join as deputy general counsel from broker ICAP, and Carmel Speers
will be its head of financial crime and compliance of the Middle
East, North Africa and Pakistan.
The hires come as a Justice Department-appointed monitor,
Navigant Consulting Inc., begins to check how Standard Chartered's
global operations comply with U.S. sanctions rules, according to
people familiar with the matter. Last year, Navigant flagged
deficiencies in the bank's anti-money-laundering systems at its New
York Branch, resulting in a $300 million fine for the bank.
In 2012, Standard Chartered settled allegations of sanctions
violations with both the New York Department of Financial Services
and the Justice Department. As part of the 2012 deferred
prosecution agreement with the DFS, Standard Chartered had to hire
a consultancy to check that its U.S. operations had adequate
controls.
Late last year the Justice Department separately ordered the
bank to hire a monitor for a new gig: checking that Standard
Chartered is keeping tabs on the funds flowing through its global
operations.
Navigant Consulting has now been hired to conduct both the DFS
and Justice Department monitorships. The Navigant team, led by
ex-prosecutor Ellen Zimiles, will, among other tasks, look at the
bank's Middle Eastern operations, according to a person familiar
with the probe.
Standard Chartered is working hard to beef up its crime fighting
credentials. On Monday the bank said it has increased the head
count in its Financial Crime and Compliance unit fivefold. The
lender has already created a board committee to focus on financial
crime and spent heavily poaching top compliance executives from
rival firms.
The Justice Department's deferred prosecution agreement is set
to run until 2017. Under the agreement, Standard Chartered avoids
criminal charges as long as it doesn't break the law during that
period.
In its annual report, Standard Chartered said it was cooperating
with a Justice Department investigation related "to possible
historical violations of U.S., sanctions laws and regulations." In
its half-year earnings report the bank said it couldn't predict the
timing or the outcome of the probe but said it recognizes that its
compliance with sanctions and anti-money-laundering requirements,
"not just in the U.S. but throughout its footprint are and will
remain a focus of the relevant authorities."
Write to Max Colchester at max.colchester@wsj.com
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