Dive Brief:

• Rep. Elise Stefanik, R-NY, has asked Attorney General Pam Bondi to launch a probe into Standard Chartered Bank’s alleged sanctions evasion and New York Attorney General Letitia James’ related “failure to act.”
• Stefanik, in a letter Thursday, asked for a special attorney to be appointed to investigate, referencing an “ongoing sanctions evasion case” related to the British bank that is set to expire Tuesday if no further action is taken. “Without further action on this case, there is grave risk of additional funds being funneled to terrorist organizations that endanger the United States and the American people,” Stefanik wrote to Bondi. 
• The bank said the allegations “are entirely false and have been rejected by U.S. courts multiple times.” StanChart “expect[s] the dismissal of this case will continue to be upheld on appeal,” it said in a Friday statement. James’ office declined to comment.

Dive Insight:

London-based StanChart made at least $9.6 billion in “illicit payments to known terrorists,” Stefanik claimed, and “China has been using Standard Chartered Bank to purchase sanctioned Iranian oil.” 

“These payments were hidden from required disclosure under the current deferred prosecution agreement being supervised by the Southern District of New York and the U.S. Attorney for Washington D.C.,” Stefanik contended.

Stefanik also blasted James, alleging the state attorney general and her top lieutenants were briefed by terrorist financing experts and whistleblowers about the payments and “not only did nothing about this but she then approved the bank’s annual license.”

James’ “failure to act” raises questions “including what else did she know about these illicit payments and was she coordinating with the Biden Administration to ignore these payments,” Stefanik wrote to Bondi. 

Whistleblower reports revealed StanChart used servers based in Newark, New Jersey, to execute the payments, Stefanik said. 

“Due to the immediate national security risks presented by Standard Chartered Bank’s activity and NYAG James’ failure to act I ask that you appoint the Acting U.S. Attorney for the District of New Jersey as Special Attorney to the Attorney General in charge of all matters involving Standard Chartered Bank,” Stefanik wrote to Bondi.

The bank, in its statement, said it will “fully cooperate with any relevant authorities to reassure them that these allegations” – which stem from a 2012 civil lawsuit – “are meritless. The facts have not changed.”

The Justice Department “has repeatedly declined (over various administrations) to intervene in this case including in 2012, 2017, 2019 (when the DOJ moved to dismiss [the plaintiff’s] complaint),” Jefferies analyst Joseph Dickerson wrote in a Sunday note. Additionally, in 2024, a petition for writ of certiorari filed with the Supreme Court was denied, he noted.

In 2019, U.S. and U.K. authorities ordered StanChart to pay $1.1 billion related to allegations of lax anti-money laundering controls and violating sanctions against a number of countries including Iran.