There is a possibility that US authorities may be forced to consider a more severe penalty for HSBC than previously expected for money laundering charges, said Global Witness today. Last December the bank agreed with the US authorities to pay a $1.9 billion fine as part of a Deferred Prosecution Agreement (DPA) to settle charges that the bank had violated US laws. However the judge responsible for signing-off on the DPA has yet to do so.
The DPA followed an investigation which found that HSBC had failed to establish and maintain adequate anti-money laundering systems and so allowed money laundering by drugs cartels, terrorists and pariah states.
Stuart McWilliam of Global Witness commented “news that the DPA hasn’t yet been signed-off means the Department of Justice may get the opportunity to reconsider the penalties HSBC might face for its widespread money laundering failures. Given that over 35,000 people were brutally slain in Mexico at the hands of drug traffickers while the bank took at least $880m of drug money, it is shocking that the current system of penalties does not include senior executives being held personally responsible for the actions of their institutions. Is HSBC too big to jail?”
“The existing system of fining banks has clearly not deterred the likes of HSBC from violating money laundering laws. It is high time that sanctions were increased. Senior bankers should be held personally responsible for the actions of their institutions, including in the most egregious cases fines and jail, and at very least being banned from working in the industry and having their bonuses clawed back. Fines for banks need to be increased to a more appropriate level to match their crimes, and regulators need to improve the way they enforce anti-money laundering legislation”.
/ ENDS
For further comment or interview please contact Stuart McWilliam, +44 7711 007911, [email protected]
Notes
- For details of the Department of Justice charges against HSBC see For Mexican Government figures on killings by drug gangs during that period see June S. Beittel “Mexico’s Drug Trafficking Organizations: Source and Scope of the Violence” April 2013, p25 http://fpc.state.gov/documents/organization/208173.pdf and also CBS News “Mexican drug war toll: 47,500 killed in 5 years” 11 January 2012 http://www.cbsnews.com/8301-202_162-57357503/mexican-drug-war-toll-47500-killed-in-5-years/
- For Mexican Government figures on killings by drug gangs during that period see June S. Beittel “Mexico’s Drug Trafficking Organizations: Source and Scope of the Violence” April 2013, p25 http://fpc.state.gov/documents/organization/208173.pdf and also CBS News “Mexican drug war toll: 47,500 killed in 5 years” 11 January 2012 http://www.cbsnews.com/8301-202_162-57357503/mexican-drug-war-toll-47500-killed-in-5-years/
There is a possibility that US authorities may be forced to consider a more severe penalty for HSBC than previously expected for money laundering charges, said Global Witness today. Last December the bank agreed with the US authorities to pay a $1.9 billion fine as part of a Deferred Prosecution Agreement (DPA) to settle charges that the bank had violated US laws. However the judge responsible for signing-off on the DPA has yet to do so.
The DPA followed an investigation which found that HSBC had failed to establish and maintain adequate anti-money laundering systems and so allowed money laundering by drugs cartels, terrorists and pariah states.
Stuart McWilliam of Global Witness commented “news that the DPA hasn’t yet been signed-off means the Department of Justice may get the opportunity to reconsider the penalties HSBC might face for its widespread money laundering failures. Given that over 35,000 people were brutally slain in Mexico at the hands of drug traffickers while the bank took at least $880m of drug money, it is shocking that the current system of penalties does not include senior executives being held personally responsible for the actions of their institutions. Is HSBC too big to jail?”
“The existing system of fining banks has clearly not deterred the likes of HSBC from violating money laundering laws. It is high time that sanctions were increased. Senior bankers should be held personally responsible for the actions of their institutions, including in the most egregious cases fines and jail, and at very least being banned from working in the industry and having their bonuses clawed back. Fines for banks need to be increased to a more appropriate level to match their crimes, and regulators need to improve the way they enforce anti-money laundering legislation”.
ENDS
For further comment or interview please contact Stuart McWilliam, +44 7711 007911, [email protected]
Notes