Standard Chartered Bank Fined £46.5 Million for Regulatory Failures

The Prudential Regulation Authority (PRA) has imposed a hefty £46.55 million fine on Standard Chartered Bank, the United Kingdom regulator announced on Monday.

The bank was accused of failing to be ‘open and cooperative’ with the regulator and for its lapses in reporting governance and controls related to a tailored PRA liquidity expectation.

As detailed by the official press release, the PRA imposed a temporary additional liquidity expectation on SCB in October 2017 over concerns of the heightened risk of USD liquidity Liquidity The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent The term liquidity refers to the process, speed, and ease of which a given asset or security can be converted into cash. Notably, liquidity surmises a retention in market price, with the most liquid assets representing cash.The most liquid asset of all is cash itself.· In economics, liquidity is defined by how efficiently and quickly an asset can be converted into usable cash without materially affecting its market price. · Nothing is more liquid than cash, while other assets represent Read this Term outflows, which now has been removed.

However, the bank made five errors while reporting the liquidity metric between March 2018 and May 2019, resulting in a wrong overview by the PRA on its USD liquidity positions. Though the bank reported about one of the errors after four months, the PRA expects to be notified about such errors promptly.

Furthermore, ineffective internal controls and the governance of the bank resulted in liquidity miscalculations and misreporting.

“We expect firms to notify us promptly of any material issues with their regulatory reporting, which Standard Chartered failed to do in this case,” Sam Woods, the Deputy Governor for Prudential Regulation Regulation Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Read this Term and CEO of PRA, said in a statement.

“Standard Chartered’s systems, controls and oversight fell significantly below the standards we expect of a systemically important bank, and this is reflected in the size of the fine in this case.”

Fines after Fines

The enforcement action against Standard Chartered is the highest penalty ever imposed by the PRA on an individual case. Additionally, the bank did not challenge the regulatory decision and agreed to resolve the lapses, thus qualifying for a discount of 30 percent in the original fine of £66.5 million.

Meanwhile, two other banks in the UK also faced massive regulatory fines recently for severe lapses in their operations. NatWest and HSBC were ordered to pay £264.8 million and £63.9 million in fines, respectively, for critical failures in their anti-money laundering processes.