India to seek HSBC, Stanchart details from UK regulator
Tags:
The Reserve Bank and other Indian agencies are seeking details from British financial regulator FSA about two UK-based global banking giants HSBC and Standard Chartered whose outsourcing of key oversight jobs to India has come under the US scanner in separate probes related to issues like money laundering and terror financing.
Both the matters have come to the fore in less than a month's time, raising serious concerns over the impact on the image of Indian outsourcing industry and possible implication on India's fight against money laundering and terror funding.
Sources close to the development said the Indian financial sector authorities have started gathering all possible details about the two banks and any possible lapse in their compliance to regulations against money laundering and terror financing.
As part of this exercise, banking regulator RBI would soon approach UK's Financial Services Authority (FSA), with which it had recently signed a new Memorandum of Understanding (MoU) for exchange of information and co-operation in surveillance operations, a senior official said.
Issues related to HSBC and Stanchart would be discussed at the next meeting of representatives of RBI and FSA, along with other supervisory developments and matters concerning various banks having operations in India and the UK, the official said.
New York state's key banking regulator, the Department of Financial Services (DFS), had accused Standard Chartered Bank of hiding about 60,000 secret transactions with the Iranian government, involving a whopping USD 250 billion, and exposing the US financial system to terrorists, weapon dealers and drug kingpins.
HSBC's staff in India have also come under the scanner in a separate probe in the US for deficiencies in their role as 'offshore reviewers' of the global banking giant's compliance to safety mechanism against money laundering and terrorist financing.
Post new comment