Senate Report Accuses HSBC Of Involvement In Mexican Money Laundering, Circumventing Iran Sanctions And More

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Photo: Flickr/Rev Dan Catt

HSBC will go before a Senate committee tomorrow to answer for the findings of a report that alleges the bank has fostered links to terrorism, engaged in money laundering, and carried out transactions for sanctioned Iranian companies, Bloomberg’s Jesse Hamilton and David Voreacos report.From Bloomberg:

“HSBC used its U.S. bank as a gateway into the U.S. financial system for some HSBC affiliates around the world to provide U.S. dollar services to clients while playing fast and loose with U.S. banking rules,” said Senator Carl Levin, the Michigan Democrat who heads the subcommittee. “The failure of accountability here is dramatic.”

The basic gist of the report is that HSBC’s lax controls made them complicit with enemies of America’s financial system. We’re talking ignoring potential links to terrorist financing in Saudi banks, receiving $7 billion in shady money from HSBC Mexico (a bank with “‘severe’ deficiencies in anti-money-laundering controls”, says Bloomberg), sending thousands of Iran-involved transactions through the U.S. bank without telling some U.S. bankers (though some knew), and more.

Of course, there is an agency that’s supposed to be regulating this activity — Office of the Comptroller of the Currency. The Senate report accuses the OCC of knowing about these violations but ignoring them, or treating them lightly, for years.

Looks like we’ll have to add to the list of Wall Street 2012 summer scandals.

 

 

 

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