Money laundering settlements. Are fines from the U.S. just a cost of doing business?

August 20, 2012, 8:29 am

My previous post described the settlement by Standard Chartered bank with the New York state Department of Financial Services for $340 million over allegations of money-laundering.

I also listed six other settlements I found in two Wall Street Journal articles here and here.

  • $567M – 12-09 – Lloyds TSB Bank
  • $536M – 12-09 – Credit Suise
  • $500M – 5-10 – Royal Bank of Scotland
  • $298M – 8-10 – Barclays
  • $619M – 6-12 – ING Bank
  • $340M – 8-12 – Standard Chartered – settlement with New York regulators
  • $700M announced reserve for settlement – HSBC Holdings PLC
  • $???M – Standard Chartered will have a separate settlement with US authorities

What is going on?

The cases leave me scratching my head wondering what’s going on in the big banks.

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Standard Chartered settles money laundering case. The latest in a string of settlements.

August 18, 2012, 11:16 am

The British bank has agreed to a $340 million penalty to settle allegations from New York state regulators that the bank was laundering money for their Iranian customers. The Wall Street Journal describes a settlement in their article Bank Settles Iran Money Case. This is one in a long string of settlements for money-laundering.

The accusation by the New York Department of Financial Services is that over the course of a decade the bank hid Iranian involvement for 60,000 wires totaling $250 billion.  The basic concept is the wires were withdrawn after initial submission and the identifying information removed from the transaction, then the instructions were resubmitted.

I touched on this in an earlier post.

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Is cheating rampant in our culture?

August 9, 2012, 9:26 am

Rich Karlgaard from Forbes thinks so. In his article, Recovery Drag: The Age of Cheats, he surveys the moral rot in sports, quickly touches on the rot in business and our political system and concludes we are in an Age of Cheats.

Is there something wrong in the sports world? Consider this:

Sosa was a former 165-pound rookie who weighed 220 pounds the year he banged out 66 homers, chasing McGwire’s 70.

A 55 pound bulk up?

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Is there anything more to ethics than just avoiding criminal behavior?

July 19, 2012, 9:03 am

Consider this ethics case study: 

You work at a company that processes low-level radioactive waste from hospitals. Everyone knows your company is in serious financial trouble. Your manager tells you to start dumping truckloads of unprocessed waste material on the school playgrounds in your community. Just one truckload per school per month– your boss says that’s not enough to make anyone sick. What is the ethical thing to do? Develop and explain a range of options, choose one, and defend your choice.

While melodramatic, that case study is only a slight exaggeration from the case studies I recall from my long-ago ethics class in grad school. If memory serves, we had one class that was half marketing and half business ethics. The case studies, as I recall, were primarily dramatic overstatements with a painfully obvious correct answer. Those that weren’t extremely obvious had several choices, all of which were it-feels-good options with minimal ethical distinctions.

Melodrama does not really teach ethics. Neither does mush.

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