Iran probe widens to 2 more banks
RBS and Commerzbank fall under US checks over a possible breach of economic sanctions
US authorities are investigating Royal Bank of Scotland and Commerzbank over possible breaches of sanctions on Iran, in a widening crackdown which has already cost Standard Chartered a hefty fine.
An RBS spokeswoman declined detailed comment but referred to disclosures published with the bank's half-year results earlier this month. These disclosures said RBS had initiated talks with US and British authorities on whether it complied with economic sanctions on Iran, and that it could face a "material impact" from the investigation.
The inquiry raises the possibility of a substantial punishment for the part-nationalised British bank, which is also being investigated for its involvement in the Libor rate rigging scandal, ramping up pressure on chief executive Stephen Hester.
The US first imposed sanctions on Iran more than 30 years ago but has tightened them in recent years as it tries to stifle Tehran's nuclear programme.
In the disclosures accompanying the RBS results on August 3, the bank said it had "initiated discussions with UK and US authorities to discuss its historical compliance with applicable laws and regulations, including US economic sanctions regulations".
These followed an internal review begun by Hester after his arrival at the bank in 2008.
"The investigation costs, remediation required or liability incurred could have a material adverse effect on the group's net assets, operating results or cash flows in a particular period," the bank said. RBS had been making similar disclosures for the past 18 months, the spokeswoman said.
