Share Name Share Symbol Market Type Share ISIN Share Description
Standard Chartered LSE:STAN London Ordinary Share GB0004082847 ORD USD0.50
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  -4.30p -0.58% 731.80p 730.10p 730.40p 743.80p 727.20p 737.80p 7,826,445 16:35:10
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Banks 10,535.7 331.2 -11.7 - 24,088.10

Bank Summoned in Bribery Probe -- WSJ

12/09/2017 8:03am

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U.K. regulator wants Standard Chartered to discuss whistleblower claims of misconduct

By Ben Otto in Jakarta and Margot Patrick in London 

This article is being republished as part of our daily reproduction of articles that also appeared in the U.S. print edition of The Wall Street Journal (September 12, 2017).

The U.K. financial regulator has summoned Standard Chartered PLC officials to a meeting this week over a whistleblower's claims of misconduct at an Indonesian power plant builder owned by the bank, people familiar with the matter said.

The meeting, set by the Financial Conduct Authority, adds to the international scrutiny of the London-based bank related to Maxpower Group Pte. Ltd. at a time when the U.K. is strengthening provisions for whistleblowers.

The Bank of England is also in contact with the FCA about the Maxpower whistleblower's allegations, documents seen by The Wall Street Journal show.

The Journal reported last year that an internal audit and a separate probe at Maxpower by a law firm found evidence of possible bribery and other misconduct to win and maintain contracts. Standard Chartered reported the findings to the U.S. Department of Justice and other authorities. The department began an investigation into the allegations as well as whether Standard Chartered took adequate steps to prevent or stop the alleged misconduct, people with knowledge of the matter said.

Maxpower specializes in setting up gas turbines for electricity production, primarily in Indonesia and often in remote locations of the archipelago nation. Standard Chartered holds a majority stake in the company through investments by its private equity unit. The head of the unit, Nainesh Jaisingh, is one of two remaining members of Maxpower's board.

The whistleblower at Maxpower has alleged that company executives paid bribes to win business and that Standard Chartered's representatives on the board failed in their oversight. The employee, who has been negotiating an agreement to separate from Maxpower, alleges facing intimidation and retaliatory measures from executives of both companies, documents reviewed by the Journal show.

The whistleblower has also alleged that Standard Chartered executives on Maxpower's board were aware of potentially fraudulent accounting and compliance failings and didn't act.

Two of the three Standard Chartered executives who sat on the board of Maxpower during the period in question -- around 2012 to 2015, according to the probe by a law firm -- left the firm last year. Mr. Jaisingh was put in charge of selling off Standard Chartered's private-equity investments after his former boss was pushed out of the unit in November, a person familiar with the matter told the Journal last year.

Standard Chartered declined to comment on the FCA's summon for a meeting and Maxpower didn't respond to a request for comment.

Treatment of whistleblowers at U.K. banks came into focus when Barclays PLC in April said Chief Executive Jes Staley was being investigated by the FCA and the Bank of England's Prudential Regulation Authority. Mr. Staley tried to identify an anonymous whistleblower who wrote to Barclays. Mr. Staley apologized for trying to track down the source of what he said he saw as "an unfair personal attack" on a colleague.

The FCA oversees conduct of financial firms and their employees and has power to prosecute crimes, fine individuals and companies and withdraw business authorizations. Last year it introduced measures to make it easier for staff to report concerns or information on alleged wrongdoing at a firm, and to ensure firms handle the claims appropriately.

It handled 900 cases from whistleblowers in the year to March 31. The figure fell from the previous two years, which the FCA attributes to better procedures for employees to report concerns to their companies first.

Write to Ben Otto at and Margot Patrick at


(END) Dow Jones Newswires

September 12, 2017 02:48 ET (06:48 GMT)

Copyright (c) 2017 Dow Jones & Company, Inc.

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