hsbc latest in firing line

HSBC is to be fined an estimated $1bn for failure to comply with anti-money laundering controls in the US, in the latest example of a bank failing to keep its house in order.

hsbc latest in firing line


According to reports, the banking giant is set to apologise to US lawmakers for failing to have appropriate controls in place to prevent its business being a used as a channel for funding towards terrorism and other criminal activities.

This inadequacy in controls occurred between 2004 and 2010 and CEO Stuart Gulliver is reported to have sent an internal memo acknowledging the bank’s processes should have been "stronger and more affective".

"We failed to spot and deal with unacceptable behaviour and it is right we be held accountable and take responsibility for fixing what went wrong," his note continued.

HSBC forewarned the fines relating to money laundering issues could be "significant" back in its 2011 annual report and has since said it is likely to face action from other US authorities.

The bank is scheduled to appear in front of the US Senate’s investigative panel on 17 July, a hearing that will likely be attended by its chief executive of the North American business, Irene Dorner.

This latest pursuit of a large global bank for inadequate internal controls comes after the Libor scandal which precipitated the resignation of Barclays’ Bob Diamond last week, as well as the FSA fine for the mis-selling of interest rate swaps to small businesses by the "Big Four".



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