A US Senate panel has accused HSBC of exposing the country's financial system to terror financing, money laundering and drug trafficking activities.
A US Senate panel has accused global banking giant HSBC of exposing the country's financial system to various terror financing, money laundering and drug trafficking activities with transactions worth billions of dollars, due to poor risk control systems at the bank.
Among others, HSBC was found to be doing business with Saudi Arabia's Al Rajhi Bank, whose key founder "was an early financial benefactor of al-Qaeda," the US Senate's Permanent Sub-committee on Investigations has said after a year-long probe into the affairs of the global banking major.
The bank has also been accused of indulging in various questionable transactions with entities from countries like Mexico, Iran, North Korea, Saudi Arabia, Bangladesh, Syria, Cuba, Sudan, Burma, Cayman Islands, Japan and Russia.
Specifically, the bank has been alleged to have provided US dollars and banking services to some banks in Saudi Arabia and Bangladesh despite links to terrorist financing.
Reacting to the report from the Senate Sub-Committee, HSBC said in a statement that it would apologise for failing to meet regulatory and customer standards in the past.
The bank said it recognises that its "controls could and should have been stronger and more effective in order to spot and deal with unacceptable behaviour."
The Senate Sub-Committee last night released a 17-page summary report of its probe. The entire 330-page report, prepared after a year-long investigation into HSBC, along with more than 100 other documents including bank records and internal emails, is being released at a hearing here today.
The hearing would include testimony from HSBC officials and federal regulators, the sub-committee Chairman and Senator Carl Levin said in a statement.
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