As DDay noted earlier, Treasury will ignore that Standard Chartered signed a settlement confirming that it had hidden $250 billion worth of transfers by gaming its documentation so that it can sign a softball unified settlement with everyone else.
It’s more important that SCB get its softball settlement, I guess, than Treasury maintain even a shred of credibility.
But in addition to simply ignoring that earlier settlement, Treasury is also giving this excuse for its softball settlement.
Prosecutors and Treasury officials will also assess a smaller penalty because the bank came forward voluntarily with information about its transactions and compliance with United States sanctions, according to the law enforcement officials.
Remember this, from Benjamin Lawsky’s original settlement?
At a meeting in May 2010, SCB assured the Department that it would take immediate corrective action. Notwithstanding that promise, the Department‟s last regulatory examination of the New York branch in 2011 identified continuing and significant BSA/AML
- An OFAC compliance system that lacked the ability to identify misspellings and variations of names on the OFAC sanctioned list.
- No documented evidence of investigation before release of funds for transactions with parties whose names matched the OFAC-sanctioned list.
- Outsourcing of the entire OFAC compliance process for the New York branch to Chennai, India, with no evidence of any oversight or communication between the Chennai and the New York offices. [my emphasis]
As of last year, SCB wasn’t even doing what they claimed they were doing to fix this problem. More troubling, they had replicated what they and other banks had done before, simply send the office engaging in this fraud so far away from the US so as to offer the US branch plausible deniability.
That’s what counts as “voluntary” cooperation in TurboTax Timmeh Geithner’s Treasury Department: ongoing efforts to continue engaging in the same kind of games.