ANOTHER banking scandal – HSBC turns a blind eye to drug money.
I didn’t think when I wrote the top 3 banking scandals blog last week, that I should have held on a little longer to make it top 4!
So, the latest is HSBC didn’t have strict enough compliance regulations in place to prevent money laundering; the conclusion I have gathered from the various articles I have read on this is that given their lax approach to flimsy regulations, this scandal was somewhat inevitable. The Guardian writes that, “The man at head office with the title “head of group compliance” was not allowed to barge into your office to ask what checks you had conducted to discover the true source of the very large dollar deposits coming into the bank”
The big questions which are so far unanswered is not why it happened (we’ve got that more or less covered) but who can be held accountable and what will the punishment be? The metro for one tells us that “HSBC’s head of group compliance David Bagley [is] to step down”, but this scandal happened throughout the entire period of 2002-2009, it cannot fall entirely on one mans shoulders, which is why both present and ex employees have been called to answer for their actions.
The FT reports that HSBC could be looking at a settlement “with the authorities [that could potentially] cost the bank as much as $1bn. Mr Levin said that US authorities should consider revoking HSBC’s US banking licence as a consequence of the bank’s alleged violations”.
What do you think HSBC’s punishment should be? Can you believe there is another banking scandal already!?