Page 32 - IRANRptAug19

Standard Chartered hit with $1.1bn in US and UK fines for breaching Iran sanctions
Indian importers will be deposited into those accounts in rupees.
In turn, Iran is expected to purchase products and items from India in rupees to avoid any direct contravention of US sanctions aimed at any use of the US dollar.
IDBI is the second Indian bank permitted to deal with Iranian trade. UCO became the first earlier last year.
London-based Standard Chartered has agreed to pay $1.1bn to US and British authorities for conducting financial transactions that violated sanctions against Iran and other countries, government officials announced on April 9.
Some of the transactions occurred not long after Standard Chartered settled similar charges in 2012. The settlement extends by two years a deferred prosecution agreement that the bank originally entered into in 2012.
Standard Chartered “undermined the integrity of our financial system and harmed our national security by deliberately providing Iranians with coveted access to the U.S. economy,” Washington, D.C., US Attorney Jessie Liu said. “The circumstances that led to today’s resolutions are completely unacceptable”, Standard Chartered Group Chief Executive Bill Winters said in a statement. He added that they were “not representative” of the bank today. The agreements conclude a five-year-old investigation that started into Standard Chartered’s banking for Iran-controlled entities in Dubai in the United Arab Emirates
The latest penalty is a tally of fines and forfeitures imposed by US Department of Justice, the US Department of Treasury’s Office of Foreign Assets Control, the New York County District Attorney’s Office, the New York State Department of Financial Services (DFS), and the UK’s Financial Conduct Authority (FCA).
The FCA imposed a GBP102mn fine ($134mn) on the bank for its control failures. It noted Standard Chartered’s lax controls in opening an account with 3 million UAE dirham in cash in a suitcase (just over GBP500,000) and allowing a customer to export a product with potential military applications to war zones.
New York’s DFS said the misconduct involved $600mn in illegal dollar transactions between 2008 and 2014 that moved through the state from the bank’s London and Dubai offices.
8.2 Central Bank policy
Iran’s central bank reduces foreign currency rates for euro and sterling
The Central Bank of Iran (CBI) on July 9 updated the official exchange rates of 47 currencies, excluding the US dollar which has remained frozen at IRR42,000 since 2018.
The official rates are only available to parties behind specific import and export flows including oil and essential goods. The rates in play for hard currencies on the unofficial, or free, market are at least 60% higher, given the collapse in the value of the rial since early last year when it became clear that the US was reinstating a regime of heavy sanctions aimed at Iran.
The pound sterling, meanwhile, weakened for a second time in a week to IRR52,547 and the euro was down to settle at IRR47,096. A Swiss franc now fetches IRR42,253, in line with other currencies. Meanwhile, the Swedish crown reduced against the rial to IRR4,437.
On the free market by mid-afternoon on July 9, the US dollar remained flat
32 IRAN Country Report August 2019 www.intellinews.com