British banking giant Standard Chartered is a repeat offender, at least in the eyes of New York’s top financial regulator, which fined the bank $300 million and suspended its ability to convert currency because of violations of a money-laundering settlement.
On Tuesday, the New York Department of Financial Service said Standard Chartered had not flagged wire transfers from clients and locales involving a high risk of money laundering, running afoul of a 2012 agreement the bank has with the regulator. Back then, the bank paid $667 million to state and federal authorities for allegedly processing $250 billion in transactions for Iranian banks in violation of U.S. sanctions.
New problems at Standard Chartered surfaced in a recent review conducted by an independent monitor who identified high-risk transactions originating from Hong Kong and the United Arab Emirates. The monitor determined that the bank had an inadequate system in place to detect those problems, even though Standard Chartered had instituted new procedures in accord with the settlement. The bank, according to the monitor, did a poor job of auditing the system.
Tuesday’s order calls for Standard Chartered to hold off on converting foreign currency into U.S. dollars through its New York branch for retail business clients in Hong Kong. This “dollar clearing” is a critical step in transferring money to clients’ suppliers, processing loan payments and various other transactions.
Standard Chartered has agreed to cut ties with some small and medium-size business clients in the United Arab Emirates that are deemed high-risk. It will also be subject to two additional years of reviews by the monitor.
In a statement, the bank said it “accepts responsibility for and regrets the deficiencies in the anti-money laundering transaction surveillance system at its New York branch.” Standard Chartered said it has begun “extensive remediation efforts and is committed to completing these with utmost urgency.”
— Danielle Douglas
Former Microsoft chief executive Steve Ballmer, the new owner of the Los Angeles Clippers basketball team, has left the software company’s board to spend more time on his new sports project.
“I see a combination of the Clippers, civic contribution, teaching and study taking a lot of time,” Ballmer said in a letter to Microsoft chief executive Satya Nadella that was made public by Microsoft on Tuesday. “The fall will be hectic between teaching a new class and the start of the NBA season so my departure from the board is effective immediately,” he wrote.
Ballmer, 58, paid an NBA-
record $2 billion for the Clippers. On Monday, he greeted several thousand fans gathered at the team’s Staples Center home with the trademark screams that punctuated employee meetings at Microsoft.
His exit marks the end of a 34-year association with Microsoft, which had a leading role in the personal computer revolution. Ballmer joined Bill Gates’s firm in 1980 when it was just a start-up in the Seattle suburbs, and he succeeded Gates as chief executive from 2000 until February.
As Gates has sold shares to fund his philanthropy, Ballmer has become the biggest individual shareholder in Microsoft, owning a 4 percent stake worth about $15 billion.
“I hold more Microsoft shares than anyone other than index funds and love the mix of profits, investments and dividends returned in our stock,” Ballmer said in his letter to Nadella. “I expect to continue holding that position for the foreseeable future.”
● Home Depot climbed to an all-time high as purchases of big-ticket items like appliances helped second-quarter profit top analysts’ estimates and led the company to raise its annual earnings forecast. Net income for the largest U.S. home-improvement retailer rose 14 percent, to $2.05 billion, in the three months that ended Aug. 3, from $1.8 billion a year earlier, the company said. ●“These results support the view of a continued recovery in the U.S. home-improvement market,” Frank Blake, Home Depot’s chief executive, told investors during its earnings call. Shares of Atlanta-based Home Depot surged 5.6 percent, to $88.23.
● U.S. home construction increased 15.7 percent in July to a seasonally adjusted annual rate of 1.09 million homes, the Commerce Department reported. That was the fastest pace since November and followed declines of 4 percent in June and 7.4 percent in May. Applications for building permits, considered a good sign of future activity, also showed strength in July, advancing 8.1 percent, to an annual rate of 1.05 million.
● McDonald’s plans to start selling its packaged coffee at supermarkets nationally by early next year. The world’s biggest hamburger chain has made a deal with Kraft Foods to manufacture and distribute bags of McCafe ground and whole-bean coffee, as well as single-cup pods that can be used in at-home coffee machines. Other chains, such as Starbucks and Dunkin’ Donuts, already sell branded packaged coffee at retailers.
● A unit of Hain Celestial Group is recalling some peanut and almond butter because of possible salmonella contamination. The company said there have been reports of four illnesses that may be related to the nut butters. They were sold under the brand names Arrowhead Mills peanut butters and MaraNatha almond butters and peanut butters. Also being recalled were some lots of private-label almond butter from grocers Whole Foods, Trader Joe’s, Kroger and Safeway. A total of 45 production lots are affected.
— From news services
● 2 p.m.: Federal Reserve releases minutes from its July FOMC meeting.
● Earnings: Hewlett-Packard, Lowe’s, Target.