The British bank Standard Chartered, which was led by Lord Davies, the trade minister, has been alleged by the Foreign Office of “propping up” president Robert Mugabe’s government.

The Daily Telegraph of London has seen internal Whitehall emails that show the concern at the Foreign Office about the involvement of Standard Chartered Bank in Zimbabwe .”

According to the Telegraph, “Lord Davies of Abersoch was chief executive and then chairman of the bank until last month when he became a trade and investment minister. Standard Chartered is among a handful of foreign banks operating in Zimbabwe . It employs 860 people and 24 branches there.”

Actually, an internal Foreign Office briefing document alleges that Standard Chartered was diverting money to the Mugabe government.

The documents, released under the Freedom of Information Act, reveal that Standard Chartered had been diverting money to the regime through a loans scam.

In August 25, 2008 email says, “Standard Chartered risked real reputational damage if seen as passing funds to the Government of Zimbabwe. Understand that Standard Chartered had been diverting money to the GoZ due to a legal obligation to do so. But (they) must realize the repercussions of giving money to those responsible of this crisis.

An additional email from July last year accuses banks of operating in the nation of “propping up” the state Reserve Bank of Zimbabwe (RBZ).

As reported by the Telegraph, “it even suggests that Standard Chartered should close its operations there. ‘It could be argued that the banking sector is propping up the RBZ and those companies such as (name withheld) and Standard Chartered should close,” the email says. It goes on to suggest that Standard Chartered and the other bank’ are aware of the reputation at risk’ and should review their operations in Zimbabwe.

The email continues to say, “we should ask the companies to take a long hard look at what they are doing and with whom. Any opportunity to minimize contact with, and even incidental support for, the regime should be explored within the limits of practical business (and politics).”

The revelations are notable embarrassing for the Government since Lord Davies was chief executive of Standard Chartered between 2001 and the November 2006, and the bank’s chairman from November 2006. He resigned as chairman on Jan. 14, when he was appointed trade and investment minister, replacing Lord Davies of Birmingham .

To read the entire article from the Daily Telegraph of London, link here: