HSBC settles Money-Laundering probe

HSBC, the giant UK-based bank, was sanctioned by federal regulators for breaking federal money-laundering laws.

The Federal Reserve and the Office of the Comptroller of the Currency issued cease-and-desist orders to 2 US-based HSBC units for infractions that include violations of rules obliging bankers to scrutinize cross-border fund transfers.

According to HSBC Bank USA of McLean, “the HSBC’s compliance program and its implementation are ineffective, and accompanied by aggravating factors, such as highly suspicious activity”. The violations of rules were widespread and created potential for unreported money laundering or terrorist financing.

HSBC operates the United Kingdom’s 10th biggest bank holding company. It agreed to adopt policies to put it in compliance with the Bank Secrecy Act and Anti-Money Laundering laws. The regulators’ findings were neither admitted nor denied by the Bank.

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