AP source: HSBC to pay $1.9B to settle probe
WASHINGTON (AP) - HSBC, the British banking giant, will pay $1.9 billion to settle a money-laundering probe by federal and state authorities in the United States, a law enforcement official said Monday.
The probe of the bank - Europe's largest by market value - has focused on the transfer of billions of dollars on behalf of nations like Iran, which are under international sanctions, and the transfer of money through the U.S. financial system from Mexican drug cartels.
According to the official, HSBC will pay $1.25 billion in forfeiture and pay $655 million in civil penalties. The $1.25 billion figure is the largest forfeiture ever in a case involving a bank. Under what is known as a deferred prosecution agreement, the financial institution will be accused of violating the Bank Secrecy Act and the Trading With the Enemy Act.
The official spoke on condition of anonymity because the source was not authorized to speak about the matter on the record.
The London-based bank said it is cooperating with investigations but that those discussions are confidential.
The law enforcement official said an announcement of the agreement could come as early as Tuesday.
In regard to HSBC and Mexico, a U.S. Senate investigative committee reported that in 2007 and 2008 HSBC Mexico sent to the United States about $7 billion in cash. The committee report said that amount of cash indicated illegal drug proceeds.
Money laundering by banks has become a priority target for U.S. law enforcement.
In another case Monday, a British bank, Standard Chartered, which was accused of scheming with the Iranian government to launder billions of dollars, signed an agreement with New York regulators to settle their investigation with a $340 million payment.
Since 2009, Credit Suisse, Barclays and Lloyds all paid settlements related to allegations that they moved money for people or companies that were on the U.S. sanctions list.
The probe of the bank - Europe's largest by market value - has focused on the transfer of billions of dollars on behalf of nations like Iran, which are under international sanctions, and the transfer of money through the U.S. financial system from Mexican drug cartels.
According to the official, HSBC will pay $1.25 billion in forfeiture and pay $655 million in civil penalties. The $1.25 billion figure is the largest forfeiture ever in a case involving a bank. Under what is known as a deferred prosecution agreement, the financial institution will be accused of violating the Bank Secrecy Act and the Trading With the Enemy Act.
The official spoke on condition of anonymity because the source was not authorized to speak about the matter on the record.
The London-based bank said it is cooperating with investigations but that those discussions are confidential.
The law enforcement official said an announcement of the agreement could come as early as Tuesday.
In regard to HSBC and Mexico, a U.S. Senate investigative committee reported that in 2007 and 2008 HSBC Mexico sent to the United States about $7 billion in cash. The committee report said that amount of cash indicated illegal drug proceeds.
Money laundering by banks has become a priority target for U.S. law enforcement.
In another case Monday, a British bank, Standard Chartered, which was accused of scheming with the Iranian government to launder billions of dollars, signed an agreement with New York regulators to settle their investigation with a $340 million payment.
Since 2009, Credit Suisse, Barclays and Lloyds all paid settlements related to allegations that they moved money for people or companies that were on the U.S. sanctions list.
Scumbag Banksters - sell their mothers for a nickel. Thank goodness someone is FINALLY holding their feet to the fire, even just a little. They've been  doing their best to enslave all of us with interest payments on all that debt they created out of thin air. Time for them to lose, I say, and quit milking us for everything we have. Without their kind, the Nazis could have never goyten so far in WW2. It's the same for the cartels today.
"In regard to HSBC and Mexico, a U.S. Senate investigative committee reported that in 2007 and 2008 HSBC Mexico sent to the United States about $7 billion in cash. The committee report said that amount of cash indicated illegal drug proceeds."
$7 billion in illegal money and only a $1.9 billion fine. This is an example of what is wrong with our banking laws, Â crime pays. Until they make the fines larger than any possible income derived from illegal proceeds, the banks will just continue illegal behavior. Â $7 billion in cash means they can loan almost $700 billion. Thats a lot of fake money floating around all done from illegal deposits. I would have started the fine at about $100 billion and depending on how little they cooperated it would go up from there.
Read "World Banking, World Fraud" by John Cruz. This is about pervasive fraud that the author found while working at HSBC. He said that he was told that it was all OK since HSBC had a $2billion fund to handle fines levied against them. It is therefore simply amazing that the fines levied against them were $1.9 billion. NOT. So this is already considered to be just the cost of doing business. I'm sure they did not admit to "any wrongdoing", and did not have to open their books for any further examination.
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Based on this, it is clear the fraud is perfectly fine as long as the government can get their cut.
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"When plunder becomes a way of life for a group of men living together in society, they create for themselves in the course of time a legal system that authorizes it and a moral code that justifies it"
 -- Frederic Bastiat