Hong Kong (AsiaNews/Agencies) - Standard Chartered shares rebounded on Wednesday, following yesterday's losses after New York state regulators accused the British bank of illegal transactions with Iran. Yesterday, shares slumped 16.8 per cent on because of the charges. Today, they regained 2 per cent in Hong Kong and 6 per cent in London during morning trading.

The New York State Department of Financial Services said the UK-based bank systematically concealed US$ 250 billion in financial transactions with Iranian banks between 2001 and 2010, hiding some 60,000 such secret operations.

The DFS accuses the Standard Chartered of falsifying payment directions by stripping the message of unwanted data that showed the clients were Iranian, replacing it with false entries.

The banks is said to have codified their illegal procedures in a formal operating manual showing what to do when Iran was involved.

The UK bank thus "operated as a rogue institution," leaving the US banking system vulnerable to "terrorists and criminals."

The United States had imposed an embargo on transactions with Iranian banks because of sanctions and Iran's involvement with terrorism.

StanChart could be fined US$ 700 million and have its banking licence revoked in state of New York, the only place in the United States where it operates.

The British lender, which does business mostly in Asia, the Middle East and Africa, rejected the accusations saying that "well over 99.9% of the transactions relating to Iran complied" with regulations and that total value of transactions that did not follow the rules "was under $14million."

Some analysts allege that the case is part of the war among banks are waging to eliminate dangerous competitors.

In the past, other banks have found themselves charged with the same breach, including HSBC, Barclays, Lloyd's, and Credit Suisse, and settled the matter by paying a hefty fine.

Others point out that Iran embargo is full of holes even in the United States. The New York Times reported that nearly 10,000 exemption licences were granted to companies both large and small, including General Electric, Kraft Foods, Pepsi and Wrigley, ostensibly for humanitarian reasons.

But the products sold or exported include, cigarettes, Wrigley's gum, Louisiana hot sauce, weight-loss remedies, body-building supplements and sports equipment and even pop corn.