The New York State Department of Financial Services (DFS) has settled its case against Standard Chartered Bank, which will see the bank pay a US$340 million penalty, over alleged violations of financial sanctions.

The regulator announced Tuesday that it has reached an agreement to settle the issues raised in an order issued on August 6, alleging that the bank facilitated transactions that violated US sanctions against Iran. According to the DFS, they have agreed that the conduct under question involved transactions of at least US$250 billion. Earlier, the bank had said that its own review found only about US$14 million worth of possibly offside transactions.

The bank was appear before the regulator today to explain its conduct, and faced possible revocation of its license in New York. Instead, the hearing was adjourned, and Benjamin Lawsky, New York Superintendent of Financial Services, said they reached a settlement that includes a civil penalty of US$340 million that will be paid to the DFS; the bank is to install a monitor for at least two years, who will report directly to DFS, and who will evaluate its money-laundering risk controls; and the bank will permanently install personnel in its New York branch to oversee and audit any offshore money-laundering due diligence and monitoring.

In its own statement, the bank says that discussions continue around a settlement, including a payment of US$340 million, and that a formal agreement containing the detailed terms of the settlement is expected to be concluded shortly. “The group continues to engage constructively with the other relevant US authorities. The timing of any resolution will be communicated in due course,” it said.

“We will continue to work with our federal and state partners on this matter,” Lawsky added.