HSBC’s $1.9bn money laundering settlement with US authorities could be rejected, leaving the bank open to criminal prosecution and a ban from operating in America
May 27, 2013 Leave a comment
HSBC’s $1.9bn money laundering settlement could be rejected
HSBC’s $1.9bn settlement deal with US authorities over money laundering charges could be rejected, it was reported on Thursday night.
10:41PM BST 23 May 2013
Judge John Gleeson is considering cancelling December’s so-called deferred prosecution agreement that gave HSBC immunity from claims it allowed terrorists to move at least $881m (£584m) around the financial system. This could leaving the bank open to criminal prosecution and a ban from operating in America. However, HSBC disputes this. The US Department of Justice (DoJ) is reportedly challenging Mr Gleeson’s need to sign off on the deal. The judge last mentioned the case in February, stating that he had not yet approved nor disapproved of the settlement.In a statement, HSBC said: “For more than two years, our new leadership team in both New York and London has been implementing reforms and new controls, investing in compliance systems and staff, and putting in place the most effective global standards across our network to combat financial crime on a global basis.
“We are focused on taking all necessary steps to fulfill our obligation under the agreements with the US and UK governments, and on implementing effective global standards across HSBC.”
HSBC further disputes the rights of Mr Gleeson of the Eastern District of New York court to challenge the agreement it has previously reached with the DoJ.
The bank could provide further details at its AGM in London on Friday.
The settlement sparked anger among lawmakers, with attorney-general Eric Holder appearing to claim in March that HSBC had become too big to prosecute.
He said that some banks were “too large” and that inhibited the DoJ from bringing “resolutions that I think would be more appropriate”.
Mr Gleeson’s office declined to comment. The DoJ did not return calls for comment.
Meanwhile, Sir Simon Robertson, senior independent director and deputy chairman of HSBC, has been appointed to replace John Thornton as the head of HSBC’s remuneration committee. In addition, Joachim Faber, a non-executive director of the bank, is to replace Rona Fairhead as head of its group risk committee.
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