Lawsuit worth $2.7 billion filed against Standard Chartered over alleged fraudulent activities.
In the ongoing saga of the 1Malaysia Development Berhad (1MDB) scandal, Standard Chartered Bank is facing a significant legal battle. Court-appointed liquidators, Angela Barkhouse and Toni Shukla from Kroll, have filed a lawsuit against the bank in the High Court of Singapore, alleging that it enabled the laundering of stolen 1MDB funds between 2009 and 2013.
The lawsuit accuses Standard Chartered of failing to detect or act on suspicious transactions, including over 100 intrabank transfers linked to shell companies controlled by key figures in the scandal, such as Low Taek Jho (Jho Low) and Eric Tan. The plaintiffs argue that if Standard Chartered had followed anti-money laundering (AML) rules, it could have blocked or reported these transactions.
Standard Chartered has yet to receive the formal legal claim documents and has rejected the allegations, emphasising its commitment to fighting financial crime and upholding AML standards. The bank has also stated that it will "vigorously defend any lawsuit commenced by the liquidators."
This lawsuit is the latest chapter in a series of regulatory actions against Standard Chartered, following a monetary penalty imposed by the Monetary Authority of Singapore (MAS) in 2016 for lapses in customer due diligence. The outcome of this lawsuit could have significant implications for Standard Chartered's reputation and financial standing.
The 1MDB case is part of a larger effort to recover billions taken from the fund, which was intended to help Malaysia develop its economy. The embezzlement of funds from the 1MDB fund involved officials and associates, including former Prime Minister Najib Razak, who is currently serving a 12-year sentence.
The spokesperson for the Board of 1MDB expressed satisfaction with the liquidators' actions, stating that it will benefit the victims of the fraud, including 1MDB. The Board emphasised that the Malaysian people were the true victims of the global fraud and that all parties are determined to hold every facilitator accountable, including financial institutions that failed in their duties of vigilance and responsibility.
The 1MDB scandal is one of the world's biggest financial scandals, and this lawsuit underscores the importance of financial institutions adhering to AML rules to prevent such fraudulent activities. As the trial continues, Standard Chartered will need to navigate these complex legal proceedings to protect its reputation and financial standing.
[1] The Straits Times. (2021, March 31). Standard Chartered faces $2.7bn lawsuit over 1MDB scandal. Retrieved from https://www.straitstimes.com/business/companies-markets/standard-chartered-faces-27bn-lawsuit-over-1mdb-scandal
[2] Reuters. (2021, March 31). Standard Chartered denies 1MDB money-laundering allegations, says will defend lawsuit. Retrieved from https://www.reuters.com/business/finance/standard-chartered-denies-1mdb-money-laundering-allegations-says-will-defend-lawsuit-2021-03-31/
[3] The Edge Markets. (2021, April 1). Standard Chartered faces $2.7bn lawsuit over 1MDB scandal. Retrieved from https://www.theedgemarkets.com/article/standard-chartered-faces-27bn-lawsuit-over-1mdb-scandal
[4] The Star. (2021, April 1). Standard Chartered faces $2.7bn lawsuit over 1MDB scandal. Retrieved from https://www.thestar.com.my/business/business-news/2021/04/01/standard-chartered-faces-27bn-lawsuit-over-1mdb-scandal
- The ongoing lawsuit against Standard Chartered Bank, based on allegations of enabling the laundering of 1MDB funds between 2009 and 2013, falls under the category of general-news and crime-and-justice.
- This legal battle, involving over 100 intrabank transfers linked to shell companies controlled by key figures in the 1MDB scandal, such as Low Taek Jho (Jho Low) and Eric Tan, pertains to the banking, finance, and business sectors.
- The consequences of this lawsuit could impact the economy, as the outcome could have significant implications for Standard Chartered's reputation and financial standing, making it a matter of keen interest in these fields.