Compliancex

The Senate Permanent Subcommittee on Investigations is looking into allegations of money-laundering at HSBC Holdings PLC.

While the specifics of the investigation are not yet known, this falls in line with the Senate’s ongoing crackdown on shady financial transactions at global banks. In 2009 and 2010, several major banks agreed to forfeitures over transactions involving illegal activity that happened within their banks, including drug trafficking, fraud, corruption, and terrorism.

Reuters was unable to get an official comment from the subcommittee but did release a quote from HSBC spokesman Robert Sherman, who disclosed that the bank was under review for “regulatory and compliance matters.”

The London-based bank is currently operating in more than 80 countries and territories, including the US, and has gotten flack for weak money-laundering controls for some time, dating back to at least 2003.

In 2008, a Virginia doctor was indicted on counts of healthcare fraud, tax evasion, money laundering and witness tampering, allegedly moving fraudulent Medicare funds between an HSBC Bank USA internet account and HSBC accounts in Canada, Hong Kong and Phillipines.

The bank’s 2010 securities filing reveals several grand subpoenas and multiple probes, per Reuters, including Senate and SEC investigations regarding money laundering, ties to high-risk transactions in Angola, poor monitoring of bulk cash transactions and reporting of suspicious activity, and issues with filing of US taxes at HSBC USA Inc.

Sherman claims the bank is trying to tighten its regulations and is complying with investigations. Just this month, HSBC brought in former US Treasury Department official Stuart Levey, an expert in combating terrorism financing, as chief legal officer.

Daryn Strauss is a contributing writer for CompliancEX and Wall Street Job Report. She is a 2012 Writers Guild Award Nominee, Outstanding Achievement in Writing Original New Media and is the Creative Director & Founder, Digital Chick TV (www.digitalchicktv.com), Writer/Director/Executive Producer of Downsized (www.downsizedthewebseries.com), www.darynstrauss.com
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