HSBC is reportedly all set to air its dirty laundry to a Senate subcommittee next week and will apologize to authorities for allowing money laundering to go on under its own roof. Get it off your chest, HSBC. It’ll feel so much better after you do.
HSBC is Europe’s largest bank, but its apology will be directed at American officials on Tuesday. DealBook obtained an internal memo from the bank, where HSBC chief Stuart Gulliver discusses the plan to make amends for failing to prevent potential money laundering activities from going on at the bank.
“We will acknowledge and apologize for our past mistakes,” Gulliver wrote to employees in a memo, whose contents were confirmed by an HSBC spokesman. “Our anti-money laundering controls should have been stronger and more effective, and we failed to spot and deal with unacceptable behavior.”
Officials in both Washington and London are taking a closer look at similar activities at other banks. Barclays recently agreed to a $450 settlement over accusations that it had manipulated key interest rates.
Executives from HSBC will testify before the Senate subcommittee on Tuesday, with the focus point of the questions being how the bank failed to detect that any funny business was going on. The U.S. has been investigating HSBC for money laundering between 2004 and 2010.
The bank will also have to explain what steps it has taken to improve itself where internal risk management is concerned. It doubled its compliance budget to $400 million in the last two years.
HSBC to Apologize at Senate Hearing [DealBook]