City fears that Wall Street has the Square Mile in its sights

Behind

charges against shocks Standard Chartered is perhaps a major U.S. financial agenda

midmorning text message Peter Sands interrupted his vacation in Canada. The head of Standard Chartered had just started their summer holidays and unwind after the presentation of a new set of benefits records half of the city.

This is a U.S. regulator had accused the bank of violating financial sanctions against Iran was a flash of blue. It was a Monday and a few minutes of trading left in London, when the report, which said that the bank had helped clients to avoid U.S. sanctions on Iran 60,000 transactions worth $ 250 billion (160 billion), has landed.

several years, Standard Chartered, the bank had pulled through the financial crisis with a very squeaky clean reputation, told shareholders in their annual reports that he was "in negotiations" with the authorities U.S. on "historical" punish violations. But the nature of the allegations made by the Department of New York Financial Services (DFS) were extraordinary.

Despite the small window of commerce, bank shares lost 6% of its value on Monday and Tuesday morning were in freefall, losing nearly a quarter of its value at the time , as investors abandoned the action amid fears that the bank could lose its banking license in New York critical.

lamentable is the latest chapter in what has been a bad year for the Square Mile of London, which is still digesting the record fine imposed for having attempted to manipulate Libor Barclays and HSBC effusive apology in Assuming helping Mexican drug lords launder money.

Last week, Standard Chartered had boasted that he was too "boring" by the scandal and if the evidence were necessary Sands, CEO of Standard group and its leaders were not current regulator New York lawsky ambitious Benjamin was preparing to land, it lies in the fact that it took eight hours to respond agony. Standard Chartered has insisted that 99.9% of its transactions were legal and apologized to just under 300, for a total value of $ 14 million, had violated the rules.

Meanwhile investors use this time to study the report and it does not look pretty, but on the contrary, harsh speech attributed to a high standard framework approved which took a colleague New York fear of failure sanctions, memorable short confession. "Damn Americans Who are you to tell us the rest of the world, we will not deal with the Iranians"

not take long to realize that diatribe was supposed to have been made by Richard Meddings, CFO bank today highly respected. The bank insists that the quote is inaccurate.

For Tuesday Sands was on a plane back to London, leaving her vacation with her parents and return to the head office of the bank to start the return is crucial, not only for their own reputation wild but to help restore the fortunes of the battered city itself.

New York, where the president of the bank, Sir John Peace, went to meet lawyers of the bank, the episode is presented as an example of the city of rotten heart of London . "It seems that every great disaster arrives in London trading," said Carolyn Maloney in the U.S. Congress House Financial Services Commission investigation that the massive loss of JP Morgan in London earlier this summer.

• Ironically, until the banking crisis of 2008, London was arrested by U.S. policymakers as a model of economic dynamism. «Back to 2005, 2006 and London was the envy of New York," said Peter Henning, a professor at Wayne State University Law Center. London was lighter regulation and the Financial Services Authority (FSA) has been considered "bite", a trait that Henning said he was admired by Wall Street bankers.
• Meanwhile, Michael Bloomberg, Mayor of New York, and New York Senator Charles Schumer warned that the city was "stifled by restrictive regulations" put in place after the Enron scandal.
• Henning
• As mentioned above, a large part of the - alleged and admitted - otherwise Barclays, HSBC and Standard Chartered envied happened during this period of "light-touch" regulation. "Well, now, I think we will probably see the consequences," he added.

with the regulatory framework of the city tightens the coalition government, the dissolution of the FSA and to cede control of banking supervision at the Bank of England in London, it is feared American politicians are opportunistic.

DFS
addition, Standard Chartered is in talks with four other agencies, including the Treasury Department's Office of Foreign Assets Control, but apparently broke ranks lawsky without informing other agencies.

Labour MP John Mann, is not a friend of the bank as a whole, feared "a growing anti-British bias regulators and politicians who seek to change the financial markets London to New York. "
Even the Bank of England, Mervyn King, Governor Sir must say that the British authorities expect that the various U.S. regulatory authorities to work together while Chancellor George Osborne has sought assurances from U.S. Treasury Secretary Tim Geithner that Standard Chartered would be treated fairly, the U.S. authorities usually work in these colonies.

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