By Martin Kelly
UK Bank Standard Chartered has been forced to pay $340 million in an effort at keeping its US licence.
The penalty, which works out at £217m, follows allegations that the bank had behaved like a “rogue institution” after US regulators accused it of attempting to hide deals worth 250 billion dollars with the sanction hit regime in Iran.
New York State Department of Financial Services (NYSDFS) accused the London-based banking group of concealing 60,000 transactions with Iranian clients, including the Central Bank of Iran, from 2001 to 2010.
The department says there is also evidence of similar schemes to conduct business with other US-sanctioned countries such as Libya, Myanmar (Burma) and Sudan.
The penalty will also see officials from the NYSDFS monitor the UK bank to ensure its transactions comply with US regulations.
Benjamin Lawsky, New York Superintendent of Financial Services, issued a statement saying: "The New York State Department of Financial Services and Standard Chartered Bank have reached an agreement to settle the matters raised in the DFS Order dated August 6, 2012.
"The parties have agreed that the conduct at issue involved transactions of at least $250bn."
Last week Lawsky had described the bank as a “rogue institution” for breaking US sanction laws.
Had no deal been agreed then the bank faced losing its New York trading licence. The announcement of a deal follows calls last week by Chancellor George Osborne to US treasury secretary Timothy Geithner.
The Standard Chartered fine brings to $1 billion the total fines paid by UK banks after investigations by US regulators.
In 2010, Barclays Plc paid $298 million after US regulators found it had broken rules in deals with Iran, Cuba, Libya, Myanmar and Sudan. In 2009, Lloyds TSB agreed to pay a $350m fine to US regulators over transactions illegally conducted on behalf of customers from Iran and Sudan.