HSBC Holdings and Standard Chartered may settle US charges involving money-laundering violations and dollar-clearing transactions on behalf of Iranian clients as soon as next week, two people familiar with the negotiations said.
The agencies involved in the settlements include the US Treasury’s Office of Foreign Assets Control, the Federal Reserve, the Justice Department and the New York District Attorney’s office, according to the people, who asked not to be identified because negotiations are still under way.
HSBC announced last month that it had added an US$800 million (HK$6.2 billion) provision to an existing US$700 million reserve to cover the costs of a potential settlement, and warned investors that the final payment could “significantly” exceed the US$1.5 billion total.
A Senate committee said in July that failures in London-based HSBC’s money-laundering controls allowed terrorists and drug cartels access to the US financial system.
Standard Chartered has said it expects to pay about US$330 million to settle claims by federal regulators that its money- clearing operations violated rules related to US sanctions against Iran. The London-based bank agreed in August to pay US$340 million to resolve charges brought by New York’s banking regulator that it hid the identity of Iranian customers involved in dollar-clearing transactions.
“As we’ve disclosed, we are co-operating with authorities in ongoing investigations,” Robert Sherman, a spokesman for HSBC in New York, said on Friday. “The nature of any discussions is confidential.”