Sir John Peace really should know better. He is the chairman of a bank, Standard Chartered, that has admitted responsibility for breaching US sanctions against Iran and agreed to pay huge fines. In that position you cannot drop broad hints that you think the bank was a victim of a shake-down by regulators.
Peace's inflammatory words at his press conference earlier this month were: "We had no wilful act to avoid sanctions."
Not surprisingly, the US department of justice and New York County district attorney's office have come down on him like a ton of bricks. They have, in effect, told him to sit on the naughty step and repeat the shameful lines for public consumption: "Standard Chartered Bank unequivocally acknowledges and accepts responsibility … for past knowing and wilful criminal conduct in violating US economic sanctions laws and regulations, and related New York criminal laws."
The interesting part is the context of Peace's stupid remark. He was being asked about pay and bonuses. Why wasn't the bank trying to claw back past bonuses? The question remains.
OK, strictly speaking, there is a straightforward answer: clawback provisions were not in place in 2001-07 when the sanction-breaching took place. On the other hand, Standard Chartered's current chief executive, Peter Sands, and its finance director, Richard Meddings, were both in senior positions during that period. Sands was finance director for most of the time and Meddings was a group executive director responsible for risk. After a fine of £415m – bigger than Barclays's Libor punishment – some form of informal clawback would surely be in order.
The bank can't have it both ways. It could have chosen to fight the allegations, which was its first instinct. But once it admitted criminal action and settled, it was obliged to follow through internally.
