"And remember, where you have a concentration
of power in a few hands, all too frequently men with the mentality of
gangsters get control. History has proven that."
John Dalberg Lord Acton
This HSBC scandal is being overshadowed by LIBOR a bit in the States at
least, and the usual diversions of the day to day, but it seems about to
explode into the headlines of the insular major media.
There is chatter in banking circles that HSBC is about to be handed a record
fine of one billion dollars, or more. At least this is what I hear. Obama
will point to it as a 'get tough' approach to the rampant fraud and bad behaviour that is still plaguing the US recovery and
The US has been looking to make an example that whilst some banking excesses
might be tolerated, there are areas of dirty financial dealing that go a step
too far and will be dealt with. Especially if the perpetrator is not in the
official stable of monetary mavens. The august Senators are still chafing at
having to kowtow publicly to some of the pampered princes of Wall Street,
whose deep pockets fill their campaign coffers.
Stephen Green, made Baron of Hurstpierpoint in
November 2010, and the former head man at HSBC, a conservative politician and
current Cabinet Minister for Trade and Investment, will almost certainly
plead the CEO defense for the crimes that were committed during his tenure
over the Bank. His profile is rather high now because of his role in the
When government officials and candidates refuse to answer questions or
disclose information they often have something to hide, especially if it
involves some of the dodgier financial havens of the world where cash is king
and the law is just a piece of paper.
The deals with Iran rankle, but the drug money laundering through HSBC in
Mexico and Brazil was utterly over the top. I expect some of their money
dealings in the Cayman Islands might prove interesting if they ever come to
light, given the people and firms that are involved. But that is not very
likely for that very reason.
Let's see what happens.
HSBC emails add to pressure on minister
Jane Merrick, Matt Chorley
Sunday 22 July, 2012
Lord Green must come clean on money laundering
Pressure on Lord Green, the trade and investment minister, to explain his
role in the HSBC money-laundering scandal escalated last night, after
documents showed he attended a meeting with senior bank staff at which
"Iranian payments" were discussed.
Lord Green of Hurstpierpoint, who was chief
executive and later chairman of Britain's biggest bank during the period of
large-scale money-laundering at HSBC, has resisted calls by Labour to appear in the House of Lords to reveal how much
he knew about the activities.
Labour's leader in the Lords, Baroness Royall, and
the shadow City minister, Chris Leslie, stepped up calls for the minister to
explain his role, as it emerged that Lord Green will be at the forefront of
the Government's business campaign during the Olympics, hosting events that
include a networking lunch on China Business Day on 27 July and a summit on
healthcare and life sciences on 2 August.
The full scale of the HSBC scandal emerged last week when the Homeland
Security sub-committee of the US Senate published a damning 340-page report
into money-laundering at the bank, which included allowing cash transfers
linked to Mexican drugs gangs, Iran, al-Qa'ida and
Emails published by the Senate committee, led by Carl Levin, a Democrat, show
that Lord Green was copied in on a number of emails and attended a meeting in
June 2005 at which, the emails claimed, top executives discussed how to make
sure huge cash transfers from Iran would comply with US regulations on
David Bagley, the HSBC head of compliance who sensationally resigned during
last week's Senate committee hearing into the investigation, wrote on 20 June
2005 that Iranian payments had been discussed in a meeting with Lord Green
and the bank's top lawyer, Richard Bennett.
Mr Bagley wrote, in an email to another executive,
David Hodgkinson, that Stephen Green, as he then
was, wanted confirmation that the "agreed arrangements in relation to
Iranian payments had been put in place" and that they would comply with
the Office of Foreign Assets Control, a US regulator.
Mr Bagley wrote: "I thought it only right and
proper however to alert you to the fact that Stephen is looking for
confirmation that all payments are not being routed through HBME [HSBC Bank
Middle East] via a non-Group clearer, or that a reasonably proximate date has
been set by which time those arrangements will be in place."
The email suggests that Lord Green was alerted to the issue and was keen that
the Iranian transfers complied with US regulations on money-laundering. There
is no suggestion of wrongdoing on the part of Lord Green. However, despite
the meeting, and the emails sent to Lord Green, money-laundering continued to
be rife at HSBC for at least another two years. Lord Green was chief
executive from 2003-06, before being appointed chairman. He stood down from
the bank in 2010 when he was given a peerage and the job of trade minister by
Senator Levin said last week: "HSBC's chief compliance officer and other
senior executives in London knew what was going on but allowed the deceptive
conduct to continue." Contacted by The IoS
yesterday, Senator Levin's office declined to comment on the role of Lord
Mr Leslie, the shadow City minister, has written to
Lord Green asking him to clarify what steps he took to crack down on
money-laundering at the bank and its subsidiaries....
Read the rest here.