AFP: US justice authorities are broadly probing Chinese banks over their business with Iran, The New York Times reported Thursday, after one Chinese bank was hit with sanctions in late July.
WASHINGTON (AFP) — US justice authorities are broadly probing Chinese banks over their business with Iran, The New York Times reported Thursday, after one Chinese bank was hit with sanctions in late July.
The authorities have extended investigations of British banks HSBC and Standard Chartered to search for information on Chinese banks’ relationships with Iran that might have violated US sanctions, the Times said.
The probes involve the US Justice Department and the Manhattan, New York district attorney’s office, and remain at an informal level.
But they come after both of the British banks have been hit with hefty fines in the United States for handling money transfers and other business that crossed US sanctions.
Earlier this month Standard Chartered settled extensive sanctions violation allegations with New York state’s Financial Services Department, agreeing to pay a $340 million fine.
Federal officials are still investigating the bank on the same accusations.
Both banks have extensive Asia and Middle East networks and both have deep links with China’s financial system.
“Prosecutors hope that the banks’ executives, as part of settlements, will shed more light on Chinese banks’ independent relationships with Iran,” the Times said.
But US prosecutors do not yet have enough information to launch formal investigations, it added.
The main concern is that suspect Iran firms may tap Chinese banks to help transfer money to them that could be routed through US units of the Chinese banks.
Investigations into sanctions violations by other major global banks, including ABN-Amro, Barclays, Credit Suisse, Lloyds and ING, “yielded valuable information about Chinese banks’ relationships with Iran,” the Times said, citing US law enforcement officials.
On July 31 Washington imposed official sanctions on the Bank of Kunlun, which is controlled by the state-owned energy giant China National Petroleum Corp.
The US Treasury said the bank “has provided significant financial services to more than six Iranian banks that were designated by the United States in connection with Iran’s weapons of mass destruction programs or its support for international terrorism.”
A furious Beijing said the US move on Kunlun Bank was groundless and “seriously violates the norms of international relations and damages China’s interests.”