Mervyn King slams US regulator over Standard Chartered claims

Aug 8, 2012

Bank governor criticises US regulator for raising money laundering claims while inquiry is ongoing

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MERVYN KING has slammed New York's financial regulator for its public - and extremely colourful - denunciation of Standard Chartered, the British bank accused this week of conspiring with the Iranian government to launder money.

At his quarterly news conference, the Bank of England governor was asked whether US regulators are engaged in a trade war against the City, which vies with New York for the reputation of the world's financial capital.

The Daily Telegraph notes that senior British politicians have suggested the Standard Chartered allegations, coming so soon after claims of wrongdoing at Barclays (alleged Libor fixing) and HSBC (alleged money laundering in Mexico), are evidence of just such a campaign.

While denying US sabotage against the City, King singled out the New York Department of Financial Services (DFS) for criticism.

"It's very important for people to distinguish between these different episodes," said King. "In the Libor one, all the regulators involved, whether it be in the United States or the United Kingdom, produced coordinated publication of reports, which came out after the investigation was completed and they have made their judgments.

"That's very different from what's happened in the Standard Chartered case where one regulator but not the others have gone public while the investigation is still going on."

King asked regulators to "refrain from making too many public statements until the investigation is completed".

The Financial Times reports that the DFS is just one of at least five US agencies involved in the investigation into Standard Chartered's alleged Iranian dealings.

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