Standard Chartered Bank Fined £20.47m

for breaching Ukraine Sanctions

The UK Office of Financial Sanctions Implementation (OFSI) which is a division of the UK Treasury has imposed fines totalling £20.47m against Standard Chartered Bank for breaches of EU Regulations providing for sanctions relating to loans given to a Russian Bank as this action was deemed to be contrary to EU Rules on Ukraine sovereign integrity.

Standard Chartered Bank had made a voluntary disclosure of the loans which totalled some £97.4m and the Minister for various reasons reduced the initial fine imposed on Standard Chartered Bank by some 30%. The original fines totalled some £31m.

The loans which were provided by Standard Chartered Bank were to Denizbank which is a sanctioned entity.

In July 2014 the EU imposed restrictive measures against any party responsible for actions which are deemed to undermine or threaten the territorial integrity, sovereignty and independence of Ukraine. The EU Regulations are designed to prevent Russian Banks, Companies and their subsidiary from having access to EU Primary and Secondary Capital Markets including loans. It was found that Standard Chartered Bank had made a series of 102 loans to Denizbank between April 2015 and January 2018 at a time when Denizbank was an almost wholly owned subsidiary of Sberbank of Russia. At the time Sberbank itself was almost the subject of restrictive measures under the EU Ukraine sanctions regime.

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This document is for information purposes only and does not purport to represent legal advice.  
© O’Rourke Reid 2020