Standard Chartered Stocks Tumble Amid Allegations of Terror Financing and Political Pressure

A senior Republican lawmaker in the United States has called for an investigation into whether Standard Chartered facilitated illegal payments to known terrorists, criticizing New York State Attorney General Letitia James for failing to take action. The stock of Standard Chartered subsequently plunged in response to these allegations.

Congresswoman Elise Stefanik urged Attorney General Pam Bondi to prevent the expiration of a sanctions circumvention case against Standard Chartered scheduled for August 19th. Stefanik expressed concern that James, after being briefed on the payment details, did not proceed with necessary action.

"Failing to act on this case poses a grave risk of further funds flowing to terrorist organizations," Stefanik warned in her letter to Bondi. This alarm has resonated in the market, where Standard Chartered's shares dropped by as much as 7.8% in London. Meanwhile, a spokesperson for James's office declined to comment promptly.

Standard Chartered is already embroiled in multiple lawsuits initiated by U.S. military personnel and their families over allegations of financing terrorism. Stefanik claims that the bank has illicitly disbursed at least $9.6 billion to known terrorists. The bank, however, has categorically denied these accusations, stating they are "totally false and have been repeatedly dismissed by U.S. courts."

"We will, of course, fully cooperate with any relevant regulatory body to demonstrate that these allegations are unfounded," Standard Chartered declared in a statement, emphasizing that "the facts remain unchanged."

The incident reignited calls for action when Stefanik publicly revealed her correspondence with Bondi on a social platform and her website, demanding the appointment of a special prosecutor to investigate the alleged misconduct by Standard Chartered. The bank did not immediately respond to requests for comment.

Earlier on Friday, the bank's shares had already slipped by around 1.5% before abruptly plunging, reflecting a 7% loss by 14:33 GMT. According to one trader, this drop in stock value was directly linked to the released letter.