(Bloomberg) -- Standard Chartered Plc lost a bid to knock out allegations in a London lawsuit by investors that it actively pursued Iranian business as part of an “industrial scale” breach of sanctions in a claim that has the potential to run into billions of pounds.

Lawyers for the bank had sought to strike out claims that its sanctions violations and bribery was more systematic and extensive than it had previously admitted to US regulators in 2019. But a judge ruled Wednesday that investors were entitled to make the allegations, and they should be tested at a civil trial. Standard Chartered is facing claims from more than 200 investors over the widespread misconduct, which has so far cost the bank more than $1.7 billion in penalties.

The lender is facing the claim after it told watchdogs that it processed hundreds of millions of dollars in clearing transactions between 2008 and 2014 through its Dubai offices on behalf of Iranian entities. But it had tried to limit the scope of the civil suit, saying that there was little evidence of further misconduct and that US authorities themselves rejected the wider allegations.

Lawyers for the investors said that while they are still calculating the losses, the claim from around 10% of the claimants is worth £286 million ($351 million). They cite allegations from a whistleblower that Standard Chartered actively pursued Iranian business, saying the bank designed a scheme to deliberately evade sanctions. 

The plan, known to high-level officials as “Project Green,” allowed for an internal department in Dubai to “create fraudulent records” to disguise Iranian-connected clients, according to the allegations.

“We consider, however, that the bank fully complied with its reporting and disclosure obligations throughout the relevant period. We regard this claim as being without merit and will continue to vigorously defend the allegations as the claim proceeds to trial,” a spokesman for Standard Chartered said in a statement.

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