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+--- Thread: HSBC laundered drug money senate inquiry finds. (/thread-9586.html)
HSBC laundered drug money senate inquiry finds. - Magda Hassan - 17-07-2012
Lax controls at Europe's largest bank, HSBC, allowed Mexican drug cartels to launder billions of dollars through its US operations, an investigation by the US senate has found.
The extensive report on London-based HSBC Holdings PLC by the Senate Permanent Subcommittee on Investigations also says US regulators knew the bank had a poor system to detect problems but failed to take action.HSBC executives brushed off complaints from other bank employees, so that the problems persisted for eight years, the report says.
In addition, some HSBC bank affiliates skirted US government bans against financial transactions with Iran and other countries, according to the report.
The US investigations follow the Barclays Bank scandal in the UK over manipulated interest rates, which has provoked international outrage over what many view as regulators' failure to enforce financial regulation.And HSBC's US division provided money and banking services to some banks in Saudi Arabia and Bangladesh believed to have helped fund al-Qaeda and other terrorist groups, the report said.
The subcommittee released the report Monday ahead of a Tuesday hearing on the topic. HSBC released a statement saying its executives will offer a formal apology at the hearing.
"We will apologise, acknowledge these mistakes, answer for our actions and give our absolute commitment to fixing what went wrong," the statement said.
The US justice department said it is conducting a criminal investigation into HSBC's operations but declined to confirm that the bank is in settlement talks.HSBC's net income last year was $16.8bn. It operates in about 80 countries around the world. Its US division is among the top 10 banks operating in the United States. It has assets of roughly $210bn in its US operations.Illicit money
Money laundering takes profits from the trafficking of drugs, arms or other illicit activities and passes them through bank accounts to disguise the illegal activity.
The bank used its US operation as a "gateway" into the US financial system for other HSBC affiliates, Senator Carl Levin, the subcommittee's chairman, told reporters Monday. Because of lax controls against money laundering, HSBC Bank USA "exposed the United States to Mexican drug money" and other suspicious funds, Levin said.
[TABLE="width: 160, align: right"]The extensive report on London-based HSBC Holdings PLC by the Senate Permanent Subcommittee on Investigations also says US regulators knew the bank had a poor system to detect problems but failed to take action.HSBC executives brushed off complaints from other bank employees, so that the problems persisted for eight years, the report says.
In addition, some HSBC bank affiliates skirted US government bans against financial transactions with Iran and other countries, according to the report.
The US investigations follow the Barclays Bank scandal in the UK over manipulated interest rates, which has provoked international outrage over what many view as regulators' failure to enforce financial regulation.And HSBC's US division provided money and banking services to some banks in Saudi Arabia and Bangladesh believed to have helped fund al-Qaeda and other terrorist groups, the report said.
The subcommittee released the report Monday ahead of a Tuesday hearing on the topic. HSBC released a statement saying its executives will offer a formal apology at the hearing.
"We will apologise, acknowledge these mistakes, answer for our actions and give our absolute commitment to fixing what went wrong," the statement said.
The US justice department said it is conducting a criminal investigation into HSBC's operations but declined to confirm that the bank is in settlement talks.HSBC's net income last year was $16.8bn. It operates in about 80 countries around the world. Its US division is among the top 10 banks operating in the United States. It has assets of roughly $210bn in its US operations.Illicit money
Money laundering takes profits from the trafficking of drugs, arms or other illicit activities and passes them through bank accounts to disguise the illegal activity.
The bank used its US operation as a "gateway" into the US financial system for other HSBC affiliates, Senator Carl Levin, the subcommittee's chairman, told reporters Monday. Because of lax controls against money laundering, HSBC Bank USA "exposed the United States to Mexican drug money" and other suspicious funds, Levin said.
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The report says the drug cartels laundered money through the bank's US division from 2002 through 2009.
"In an age of international terrorism, drug violence in our streets and on our borders, and organized crime, stopping illicit money flows that support those atrocities is a national security imperative," Levin said Monday.
The bank said in its statement that it changed its senior management last year and has made changes to strengthen its compliance with rules to prevent money laundering.
"We ... recognize that our controls could and should have been stronger and more effective in order to spot and deal with unacceptable behaviour," the statement said.
Levin also blasted the federal agency supervising the bank's US operations, the Office of the Comptroller of the Currency. He said the agency "tolerated" HSBC's weak controls against money laundering for years.
Thomas Curry, who heads the Office of the Comptroller of the Currency, also will testify at Tuesday's hearing.
Compliance with anti-money laundering laws "is crucial to our nation's efforts to combat criminal activity and terrorism," Curry said in a statement. He said the agency expects banks to have adequate programs in place to comply with the laws.
The Wall Street Journal reported Monday that HSBC and the justice department have been in settlement talks and an accord could be struck within weeks.
Alisa Finelli, a spokesperson for the justice department, acknowledged that an investigation is under way but declined to comment on possible settlement discussions or a deal.
http://www.aljazeera.com/news/americas/2012/07/2012716213139157207.html
"In an age of international terrorism, drug violence in our streets and on our borders, and organized crime, stopping illicit money flows that support those atrocities is a national security imperative," Levin said Monday.
The bank said in its statement that it changed its senior management last year and has made changes to strengthen its compliance with rules to prevent money laundering.
"We ... recognize that our controls could and should have been stronger and more effective in order to spot and deal with unacceptable behaviour," the statement said.
Levin also blasted the federal agency supervising the bank's US operations, the Office of the Comptroller of the Currency. He said the agency "tolerated" HSBC's weak controls against money laundering for years.
Thomas Curry, who heads the Office of the Comptroller of the Currency, also will testify at Tuesday's hearing.
Compliance with anti-money laundering laws "is crucial to our nation's efforts to combat criminal activity and terrorism," Curry said in a statement. He said the agency expects banks to have adequate programs in place to comply with the laws.
The Wall Street Journal reported Monday that HSBC and the justice department have been in settlement talks and an accord could be struck within weeks.
Alisa Finelli, a spokesperson for the justice department, acknowledged that an investigation is under way but declined to comment on possible settlement discussions or a deal.
http://www.aljazeera.com/news/americas/2012/07/2012716213139157207.html
HSBC laundered drug money senate inquiry finds. - Peter Lemkin - 17-07-2012
Lovely reading.....and I'm sure most larger and many smaller banks would be found to have done the same. To them money is money and they think no further about it.:mexican:i.e. their 'morality' is money alone.
HSBC laundered drug money senate inquiry finds. - Magda Hassan - 17-07-2012
I see they are keeping up their traditions since they started out doing the same thing for the English crown to launder their opium profits.
HSBC laundered drug money senate inquiry finds. - Jan Klimkowski - 17-07-2012
Magda Hassan Wrote:I see they are keeping up their traditions since they started out doing the same thing for the English crown to launder their opium profits.
Ah Yes.
Royal Bankers.
HSBC laundered drug money senate inquiry finds. - Seamus Coogan - 17-07-2012
I'd love to have a look at who is editing this page. Note there are no controversies or criticisms of the corporation in anyway. This is ludicrous in light of their History and recent revelations.
http://en.wikipedia.org/wiki/HSBC
HSBC laundered drug money senate inquiry finds. - Ed Jewett - 17-07-2012
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http://chzmemebase.files.wordpress.com/2012/07/internet-memes-give-a-man-the-world-profit.jpg
HSBC laundered drug money senate inquiry finds. - Magda Hassan - 18-07-2012
Pair hired to clean up Irish banks named in US scandal
THE Government faces huge embarrassment today after two key figures appointed to help clean up the Irish financial system were named in an explosive US investigation into global banking giant[URL="http://searchtopics.independent.ie/topic/HSBC"]
HSBC[/URL].By Donal O'Donovan and Peter Flanagan
Wednesday July 18 2012
Chairman of state-owned AIB David Hodgkinson, and Michael Noonan's top NAMA adviser Michael Geoghegan, are both named in a 330-page report that follows an investigation into HSBC by a US Senate subcommittee set up in the wake of the 9/11 terrorist attack on New York.
HSBC is accused of "playing fast and loose with US banking rules" between 2004 and 2010 by US Senator Carl Levin, a key ally of US President Barack Obama, who chaired the team that published the report. Top NAMA adviser Michael Geoghegan was HSBC's most senior executive for almost the entire period now under investigation.
The current AIB chairman was the bank's chief operating officer between 2006 and 2008 and before that ran its Middle East business.
Crucially, the damning report makes clear that both Michael Geoghegan and David Hodgkinson were aware of the major issues at the bank during the period under investigation, including HSBC's processing of billions of dollars worth of hidden deals for Iranian banks.
Worryingly, the report puts Mr Hodgkinson at the centre of the controversial practice where Iranian deals were obscured during his term as a senior executive at the banks Middle East unit.
Dubbed "U-turns", these deals saw HSBC alter documents so that money moved between Iran and the US did not arouse suspicion from authorities. The Senate Committee said that in all HSBC conducted almost 25,000 US dollar transactions with Iran, amounting to $19.4bn.
"The vast majority of the Iranian transactions, ranging from 75-90pc over the years, were sent through HBUS (the bank's US operation) and other US dollar accounts without disclosing any connection to Iran," the report states.
In an extraordinary revelation, the report says that when internal efforts were made to stop the practice, Mr Hodgkinson contacted Michael Geoghegan, now the top advisor on NAMA, asking for his "intervention and support".
The report says Mr Hodgkinson got his way, as the Middle East unit was given a free hand or "dispensation" that meant it was free to continue altering Iranian transactions until the end of 2004.
A trawl of emails shows that Mr Geoghegan was told by another executive, John Ranaldi, that the policy amounted to a "fudge" by the bank of the true nature of its dealings, "to avoid the US embargo and seizure".
Last night a spokeswoman for AIB said the bank had no concerns over the case.
"David Hodgkinson is not a person of interest in this inquiry. There is nothing for the bank to consider."
- Donal O'Donovan and Peter Flanagan
Irish Independent
HSBC laundered drug money senate inquiry finds. - Jan Klimkowski - 18-07-2012
Magda Hassan Wrote:Pair hired to clean up Irish banks named in US scandal
THE Government faces huge embarrassment today after two key figures appointed to help clean up the Irish financial system were named in an explosive US investigation into global banking giant
.......................
"The vast majority of the Iranian transactions, ranging from 75-90pc over the years, were sent through HBUS (the bank's US operation) and other US dollar accounts without disclosing any connection to Iran," the report states.
In an extraordinary revelation, the report says that when internal efforts were made to stop the practice, Mr Hodgkinson contacted Michael Geoghegan, now the top advisor on NAMA, asking for his "intervention and support".
The report says Mr Hodgkinson got his way, as the Middle East unit was given a free hand or "dispensation" that meant it was free to continue altering Iranian transactions until the end of 2004.
.....................
Last night a spokeswoman for AIB said the bank had no concerns over the case.
"David Hodgkinson is not a person of interest in this inquiry. There is nothing for the bank to consider."
- Donal O'Donovan and Peter Flanagan
Irish Independent
Q: When is a crook not a crook?
Ans: When they're doing the bidding of the Crooks.
HSBC laundered drug money senate inquiry finds. - Phil Dragoo - 26-07-2012
I found this nice long lurid account paralleling Magda's (with additional figgers) after which I append a footnote:
BEGIN ARTICLE
Mexican Nudge For HSBC
By Avi Jorisch
Asia Times
July 26, 2012
The $28 million fine by Mexican regulators of HSBC's Mexico subsidiary announced on Wednesday is just the latest, but may not be the last, blow to hit the London-based bank for its failure to counter money laundering. Mexico's National Securities and Banking Commission said the fine, about half the subsidiary's 2011 profits, had been paid.
HSBC's failure to act adequately in various countries, but particularly Mexico, to counter money laundering through its network was at the heart of a recent US investigation of the bank that could lead it to being fined up to $1 billion by US authorities.
Last week, HSBC issued an apology and its head of compliance resigned following disclosures by lawmakers in Washington that the bank had failed to implement anti-money-laundering procedures and had facilitated illicit Iranian transactions, terrorist activity, and drug proliferation around the world.
Banking regulators and customers alike will be disappointed to learn that this global giant had become a "sinkhole of risk" that acted counter to the public interest and pursued financial gain above all.
One of the world's largest banks, HSBC has more than 7,200 offices and 300,000 employees throughout Asia, the Americas, the Middle East, and Africa. In 2011 alone, it garnered profit of nearly $22 billion.
One of its most important affiliates is in the United States and operates under the name HSBC Bank USA (or HBUS). With 370 branches throughout the country, HBUS services 3.8 million customers and processes over 600,000 wire transfers a week, two-thirds of which are reportedly handled for HSBC affiliates around the world. Access to the US dollar is crucial to HSBC's operation.
US lawmakers this month issued a 335-page report (and 530-page addendum of evidence) giving excruciating detail about the bank's failings, in addition to holding a day-long hearing that included US Treasury and Homeland Security Department officials and banking regulators.
HSBC representatives were grilled, including the famed Stuart Levey, who for seven years served as Under Secretary for Terrorism and Financial Intelligence within the US Treasury Department under presidents George W Bush and Barack Obama. He now serves as HSBC's chief legal officer.
During the hearing, in a dramatic announcement, David Bagely resigned as HSBC's head of compliance following a 20-year career at the bank. "HSBC has fallen short of our own expectations and the expectations of our regulators," Bagely said.
The Congressional report, along with the testimony of officials, reads like a pulp fiction novel. HSBC helped facilitate illicit transactions around the globe for the better part of the last decade, and its compliance culture has been "pervasively polluted for a long time," according to Senator Carl Levin.
In Mexico, the bank deposited billions of US dollars for Mexican drug cartels and the casas de cambio that acted as their agents, allowing them to launder massive amounts of cash that they smuggled across the US-Mexican border.
HSBC Mexico took dollars, transported them back to the United States, and deposited them in HBUS, thus completing the laundering cycle for the cartels. In 2007 and 2008, HSBC Mexico shipped over $7 billion in physical US dollars to the United States, more than any other Mexican bank.
HSBC allegedly acted as a major conduit to rogue regimes and provided Iran with access to the international financial sector. From 2001-2007, the bank reportedly facilitated approximately 25,000 transactions on Iran's behalf, in amounts totaling $19.4 billion, through HSBC's American affiliate (which does not include funds facilitated through other affiliates).
In an attempt to circumvent US sanctions efforts, HSBC concealed any link to Iran for 85% of these transactions.
Senior HSBC officials on both sides of the Atlantic claimed that they were not aware, but congress disclosed evidence, including emails, that demonstrates they were actually in the loop from a very early stage, and well understood the risk these transactions posed to the bank. Lawmakers also presented evidence that HSBC affiliates tried to circumvent US sanctions efforts against Sudan and North Korea.
HSBC also provided a robust correspondent banking relationship to suspect banks around the globe. For example, it serviced Saudi Arabia's Rajhi Bank, whose key founder was a generous donor to al-Qaeda. Rajhi, in turn, provided banking services to other suspect clients.
Moreover, HSBC America offered banking services to bearer share corporations, which provide anonymity by assigning legal ownership to anyone who has physical possession of the company's shares. This is a notorious method money launderers use to raise and move funds. Despite warnings from US banking regulators, HSBC opened accounts for 2,000 such corporations over the last decade.
There are a number of steps HSBC should take immediately. It should start by identifying which affiliates are located in high-risk jurisdictions and implement a robust anti-money laundering compliance program across the board. Safeguards should be put in place to ensure that none of the HSBC banks are doing business with terrorists, weapons proliferators, money launderers, or other illicit actors. In addition, HSBC should not facilitate transactions for, or do business with, the roughly 250 banks the Treasury Department has blacklisted for facilitating nefarious activity.
Other steps the bank should take include closing down bearer share accounts. It might also wish to better share information, both within the HSBC affiliate structure and with relevant government officials worldwide. This would go a long way toward ensuring it is doing its part to curb abuse of the international financial sector. In today's interconnected financial world, such measures are part of the cost of doing business.
HSBC must revamp its compliance regime across the board or face the consequences from global banking regulators, which should include losing its license to operate if it fails to carry out its obligations. Global financial institutions must use every tool in their arsenal to curb the efforts of those who exploit tainted money. HSBC is no exception.
Avi Jorisch, a former US Treasury Department official, is a Senior Fellow for Counterterrorism at the American Foreign Policy Council in Washington, DC.
END ARTICLE
Edmond Safra died December 3, 1999 in his fifth- and sixth-floor penthouse of the building known as La Belle Epoque in Monaco. His Republic Bank's 92 branches were bought by HSBC after his death. Like, the week after his death.
He was the fourth husband of Lily who subsequently became one of the richest women in the world. The death of her second husband in South America with a two-shots-to-the-chest suicide netted her 210 million per accounts.
Edmond Safra personally as well as his representatives were called upon to testify before the Senate banking committee regaring SARs (suspicous activity reports) red flags for laundering.
I was told it was Republic which laundered 8 billion for the Russian mafia. My source is Bob in New York. That should be enough, shouldn't it.
The billionaire had Shmule Cohen and up to a dozen security operatives personally guarding both the penthouse and the estate which I think made John Bearford Tipton's Silverstone look like Larry The Cable Guy's RV. I could look it up, but all that was 2000-2.
Until this HSBC laundering business. It's apparently what they do.
And why are we in Afghanistan.
We live in an age when such comments aren't non sequiturs.
Ahmed Walid Karzai was accused of being a CIA tool and a drug lord. Was defended by Gerald Posner (see New York Times, the Old Grey Gangster's Moll). Then Karzai got too hot and was assassinated. Petraeus went from theater commander to DCI. Hussein Zero "Barry the Hoop" Omama jumped in his own jet airplane and flew over to sign with the Smackistan capo until 2024.
So I got an email from an Israeli radio host who interviewed the then-wife of the defendant. He said Banca Gottardo the one used by Pavel Borodin to launder Kremlin kickbacks had a branch in the lobby of La Belle Epoque.
So I'm looking at this and looking at that, and Pavel Borodin is arrested in New York en route to Bush's inauguration, extradited to Switzerland, bailed by Putin for three million.
The trial in 2002 put the convicted arsonist away for five years.
The year before he was to be released, 2006, I got a call from Laurence Leamer "writing a book on Edmond Safra" and wanted a copy of the Monaco fire report and what's my take on it. He then laughed at mafia money laundering. And I said so you would not be one to support the second gun in the Robert Kennedy shooting.
And he laughs more--I'm such a funny guy--because his "very good friend" Dan Moldea dispelled all that.
So I'm thinking, thank you, thank you, I'll be here all week, tip your waitress.
So HSBC can't possibly be laundering money for those wascally wussians, and as for Sirhan, he had one of those burp guns with the curved barrels developed after Budapest for urban warfare.
Or, perhaps, Virginia, it's as we saw one afternoon--