No More "$1,000 Dinners & Champagne" For "Above The Law" Bankers At Standard Chartered
By Tyler Durden
Standard Chartered CEO Bill Winters is fighting the battle to right the ship at the bank on two fronts. First, Winters needs to figure out a way to deal with plunging revenues and billions in NPLs. On the other front, the CEO is working to change a culture in which he is finding many bankers consider themselves “above the law.”
Since taking over as CEO in the middle of 2015, Winters has replaced much of the senior executive team and initiated a probe into employee conduct and ethics. The result of the probe into misconduct has led Winters to add significant firepower to the bank's internal investigation team, including former detectives from the FBI, Scotland Yard, Hong Kong police and the New Zealand intelligence agency Bloomberg reports.
Winters said that he has encountered “a looseness” in the way the bank was managed since coming in as CEO, and said he's uncovered a culture where senior managers felt they were “above the law.” In a memo to employees titled #knowtherules, Winters wrote “I am concerned that a small number of employees, including some senior managers, have willfully disregarded our policies – sometimes for personal gain – and set a poor example for their peers and teams. I am deeply disappointed and angry at some of the examples we are finding.”
Still licking its wounds from a 2012 deferred prosecution agreement in which the bank was fined $667 million for violating US sanctions by engaging in $250 billion in transactions with Iran, Winters is on high alert when it comes to ethics violations and employee misconduct because as Bloomberg notes, the bank could potentially lose its US banking license if it slips up again.
In one memo, Winters described a culture where managers felt they were “above the law” and was very clear on the fact that there would be a zero tolerance policy going forward for anyone not taking bank policies seriously.
“I want this to be clearly understood – we have zero tolerance for any employee that deliberately flouts and circumvents our rules and policies, without regard for their seniority or role.”
At the moment, it appears as though Winters is putting some bite behind the bark. In the memos, Winters is providing real examples of rule breaking, and what has happened to those employees. One memo cites three senior employees who didn't disclose their investment in an unlicensed money lender that charged high interest rates, and they were all subsequently dismissed.
The risk and controls committee will dock bonus if compliance or risk officers report that policies aren't being taken seriously enough, and General Counsel David Fein who is heading the effort has made sure that the new rules have been communicated clearly to the staff of 84,000 and excuses such as “I didn't know what the policy was” will no longer fly. “They are not going to have the same mitigating factors, that stuff's gone.” Fein said.
Everything is being scrutinized at the bank, along with the big things, “smaller” things such as …read more
Source: No More "$1,000 Dinners & Champagne" For "Above The Law" Bankers At Standard Chartered
