RBS facing US scrutiny over Iran transactions

Royal Bank of Scotland is being investigated by US financial regulators in relation to its handling of transactions which may have breached sanctions on Iran, according to various reports on Wednesday.

Shortly after Stephen Hester took over as Chief Executive at the 82% state-owned lender three years ago, he initiated an internal review of procedures.

It appears that review has uncovered possible breeches of sanction legislation.

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Iran faces tight controls on the type of dollar transactions it can participate in as the international community remains concerned over its possible development of nuclear weapons.

It's believed a senior risk control officer has already left RBS in response to the probe, while the bank itself will have been nervously watching the travails of its rival Standard Chartered which paid a $340m fine to New York regulators over a series of transactions which were thought to involve drug money and terrorist funding.

RBS has been hit by a series of recent controversies, including a huge failure of its IT system, involvement in the Libor-fixing scandal and the mis-selling of complicated interest rate swaps to small businesses.

At 10:41 the stock was down 0.88%.

BS