Standard Chartered is to pay a penalty of between $200 million and $300 million - potentially this week - to settle allegations with New York’s banking regulator that it failed to identify suspicious transactions, according to media reports.

Standard Chartered is to pay a penalty of between $200 million and $300 million - potentially this week - to settle allegations with New York’s banking regulator that it failed to identify suspicious transactions, according to media reports.

As part of the settlement, UK-listed Standard Chartered may also agree to extend the contract of an independent monitor charged with identifying dubious transactions, the Financial Times reported, citing people familiar with the situation.

“Benjamin Lawsky, New York's superintendent of financial services, alleged the British lender failed to catch millions of higher-risk transactions that should have been set aside for later examination,” the Wall Street Journal said.

Standard Chartered declined to comment on the matter when contacted by Family Wealth Report today.

The news comes despite the bank having promised to improve its procedures after it was fined $340 million for violating US sanctions rules involving Sudan, Iran, Libya and Myanmar two years ago. The current investigation was reportedly prompted by the monitor that the bank brought in to watch over its international transactions back then. 

It also comes a week or so after Reuters reported that the bank is to begin trawling through data to detect any signs of money laundering or other criminality, following faults found in the software that is vital for complying with controls.

The latest accusations state that the bank’s computer program should have “flagged unusual activity to regulators but failed to catch millions of wire transfers due to some technical errors,” one of the WSJ’s sources reportedly said. However, the transactions “didn't necessarily point to instances of money laundering,” it added, citing another unnamed source.

The reports add to a run of stories about banks and potential anti-money laundering lapses. A few weeks ago, for example, France’s BNP Paribas was hit by the US with a record $8.97 billion fine for breaches of controls against blacklisted nations such as Iran and Sudan (see here). In the past, HSBC, the UK/Hong Kong-listed bank, was punished for over AML lapses in 2012, in a case where money flowed through jurisdictions.