U.S. prosecutors, who have launched an investigation into the money transaction by some global banks, suspect that HSBC could have laundered money for Mexican drug cartels and moved cash for Saudi Arabian banks with ties to terrorists.
According to a report in The New York Times, federal authorities with knowledge of the probe said federal and state prosecutors were also investigating whether HSBC flouted the U.S. law by transferring money through its American subsidiary for sanctioned nations including Iran, Sudan and North Korea.
HSBC could have to cough up nearly a billion dollars to settle the inquiry, making it the largest such settlement in history, the authorities said.
“The money laundering accusations against HSBC so far are more extensive than the potential violation of United States sanctions that is the focus of the investigations against other foreign banks, including Deutsche Bank and Commerzbank of Germany, BNP Paribas and Crt Agricole of France and the Royal Bank of Scotland,” the report quoted the law enforcement authorities as saying.
HSBC came under the U.S. scanner in July when the Senate Permanent Subcommittee on Investigations said the bank “exposed the U.S financial system to money laundering and terrorist financing risks” between 2001 and 2010. Bank executives testified at the hearing and apologised.