Reuters reports that by going it alone through the order he issued on Monday, Benjamin Lawsky, head of the recently created New York State Department of Financial Services, also complicates talks between the Treasury and London-based Standard Chartered to settle claims over the transactions, several of the sources said.
In the meantime, The New York Times reports that some Treasury Department officials, while still reviewing the transactions, suspect that Lawsky has taken too broad a view, according to people briefed on the matter. The officials think that some of the transactions, though perhaps questionable, were not necessarily illegal.
Lawsky said that Standard Chartered’s deliberate effort to mask the identity of its clients points to wrongdoing and further suggests that the bank had not fully scrutinized the transactions.
One Iranian client, for example, was told to use 'NO NAME GIVEN' in paperwork to transfer money, according to an order Lawsky sent to the bank on Monday outlining the apparent violations of law. That way, the money transfer could escape scrutiny and 'not appear to N.Y. to have come from an Iranian bank', said a 2003 e-mail from a Standard Chartered official cited in the order.