Stan­dard Char­tered un­der In­done­sia ‘bribes’ probe

The Myanmar Times - - International Business -

STAN­DARD Char­tered has ac­knowl­edged it was be­ing in­ves­ti­gated by the US De­part­ment of Jus­tice over claims that an In­done­sian sub­sidiary had paid bribes to se­cure con­tracts.

The Lon­don-based, Asia-fo­cused bank said in a state­ment that it had re­ferred the mat­ter to the “ap­pro­pri­ate au­thor­i­ties” and launched its own re­view.

The Wall Street Jour­nal said that an in­ter­nal au­dit at In­done­sian en­ergy com­pany Max­power Group found ev­i­dence of pos­si­ble bribery and US pros­e­cu­tors were ex­am­in­ing whether Stan­dard Char­tered was cul­pa­ble for not stop­ping it.

“Stan­dard Char­tered takes very se­ri­ously al­le­ga­tions of im­pro­pri­ety in any of our pri­vate eq­uity in­vest­ments,” the bank told AFP in a state­ment when asked about the re­port.

“We proac­tively re­ferred this mat­ter to the ap­pro­pri­ate au­thor­i­ties and have con­ducted our own re­view.

“When we re­ceive al­le­ga­tions of im­proper be­hav­iour in an in­vestee com­pany, we pur­sue those al­le­ga­tions vig­or­ously and act ap­pro­pri­ately, in­clud­ing shar­ing in­for­ma­tion and co­op­er­at­ing fully with gov­ern­ment au­thor­i­ties and ad­dress­ing any is­sues of in­ter­nal con­duct and ac­count­abil­ity.”

The Wall Street Jour­nal said the Max­power in­ter­nal au­dit found that more than US$750,000 in cash ad­vances needed to be ex­am­ined as pos­si­ble bribes, while lawyers who re­viewed the au­dit found in­di­ca­tions that em­ploy­ees made in­ap­pro­pri­ate pay­ments to In­done­sian gov­ern­ment of­fi­cials be­tween 2012 and 2015.

Stan­dard Char­tered be­gan in­vest­ing in Max­power in 2012 and is the ma­jor­ity share­holder. There was no im­me­di­ate com­ment from Max­power when con­tacted by AFP.

But a source close to the case told AFP the US au­thor­i­ties were in­deed ex­am­in­ing whether Stan­dard Char­tered, via its rep­re­sen­ta­tives on the Max­power board, was aware of the al­leged bribes to win gov­ern­ment con­tracts.

The in­ves­ti­ga­tion would also look at why the bank’s alert pro­ce­dures for spot­ting such mat­ters had not been trig­gered.

But the probe will fo­cus on whether Stan­dard Char­tered has vi­o­lated the terms of its 2012 de­ferred pros­e­cu­tion agree­ments with the De­part­ment of Jus­tice.

Stan­dard Char­tered paid $667 mil­lion in 2012 to set­tle charges it vi­o­lated US sanc­tions by han­dling thou­sands of money trans­ac­tions in­volv­ing Iran, Myan­mar, Libya and Su­dan.

In Au­gust 2014, the bank was hit by US reg­u­la­tors with a $300 mil­lion fine and re­stric­tions on its dol­lar­clear­ing busi­ness for fail­ing to de­tect pos­si­ble money laun­der­ing.

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