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After Years of Scrutiny, Record $1.9 Billion Settlement Not the End of Trouble for HSBC
By Brian Monroe
printThe U.S. government's landmark case against HSBC Holdings Plc for knowingly turning a blind eye to financial crime is seemingly fated to end much as it began: complex and messy. On Tuesday, the U.S. Justice Department, Federal Reserve Board, District Attorney of New York and three agencies operating within the U.S. Treasury Department disclosed $1.92 billion in settlements and penalties against the British bank, one of the largest exporters of the American dollar in the world. The settlement is in addition to $700 million in expected costs to conduct a 5-year review of its know-your-customer files, and the $290 million...
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Dozens of U.S. enforcement actions initiated in recent years in response to AML and sanctions-related violations are all at least partially predicated on the same mistake: banks deciding to onboard lucrative, but unacceptably high-risk clients over the objections of their compliance departments.
Federal officials balked at criminally charging HSBC Bank USA in 2012 over concerns that an indictment could harm the global economy and strain relations with the United Kingdom, Republican lawmakers said Monday.
The U.S. Justice Department's use of deferred prosecution agreements has been effective though often misunderstood, according to Jonathan E. Lopez, a former deputy chief of the department's Money Laundering and Bank Integrity Unit who oversaw investigations into HSBC and MoneyGram.
HSBC should have done more to vet the anti-money laundering compliance controls of banks it acquired in Mexico and Switzerland, the institution's former chief executive officer told British lawmakers Tuesday.
The axe may be falling on up to 50,000 positions at HSBC Holdings Plc but at least one department seems sheltered from the cost-cutting measures: the bank's compliance team.
British lawmakers Monday sharply criticized HSBC’s leadership for failing to prevent widespread tax evasion by clients and take responsibility for the institution’s compliance lapses.
Facing parliamentary criticism, HSBC's top executives conceded Wednesday to "unacceptable" failures of its Swiss private banking unit that led to likely account abuses and subsequent reputational damage.
London-based HSBC Holdings Plc could find itself paying more to rectify past compliance problems following disclosures this week about the bank's services for clients with criminal ties, according to analysts.
U.S. authorities should consult British regulators on the financial penalties they plan to impose on banks in the United Kingdom, Prudential Regulation Authority head Andrew Baily said Tuesday.
A number of large U.S. and international banks are dropping customer accounts and services tied to high-risk geographical regions and lines of business in response to regulatory pressure, including enforcement actions.
HSBC Bank USA will seek a new chief compliance officer after the departure of the executive who filled the role for over two years.
A House lawmaker is set to unveil a measure that would broadly expand anti-money laundering controls and require the U.S. financial intelligence unit to critique the findings of financial regulators.
Facing mounting regulatory pressure in the past year, several multinational banks are weighing whether to scale back their cash letter processing and other services for some of their foreign counterparts, say compliance professionals.
Scrutiny of HSBC Securities Centers on Suspicious Activity Reporting, Transaction Monitoring: Source
Examiners from the nation's top regulators of broker-dealers are investigating whether HSBC Securities USA sufficiently scrutinized and reported suspicious transactions, according to an individual with knowledge of the matter.
The United Kingdom Thursday detailed a plan to settle alleged corporate violations of criminal laws without pursuing prosecutions -a strategy used by U.S. officials to exact billions from financial institutions.
A growing number of compliance professionals expect that someone at a bank, even a compliance officer, will be prosecuted for violating the Bank Secrecy Act in the not-too-distant future.
Among the toasts at Adam Kaufmann's "retirement" party last week was one by a speaker who credited him with turning a bounced check into more than a billion dollars in penalties that have been shared by the city and state of New York over the past four years.
It's a question few banks ever want to hear from the U.S. Treasury Department's sanctions arm: would you waive your statute of limitations protections and allow us to review more data?
I'm not going to give you that "best of times, worst of times" crap in summing up 2012. When it comes to the year in compliance, there was just the "worst of times" and not much, if any, "best."
Criticism of the U.S. Justice Department's apparent decision to forego indictments of HSBC and its employees misses a larger point: the department probably couldn't have won convictions if it tried, say prosecutors.