HSBC's shares dropped to their lowest value in 25 years on the Hong Kong stock exchange this morning, following reports that the bank had continued to allow fraudsters to transfer millions of dollars after HSBC had discovered the Ponzi scheme scam.
The reports follow the leak of the so-called FinCEN Files, a leak of 2,657 documents mostly consisting of Suspicious Activity Reports (SARs)
The files were obtained by Buzzfeed which shared them with the International Consortium of Investigative Journalists (ICIJ). Fergus Shiel, of the ICIJ, told the BBC the FinCEN papers are an "insight into what banks know about the vast flows of dirty money across the globe… [The] system that is meant to regulate the flows of tainted money is broken."
[This represents] an insight into what banks know about the vast flows of dirty money across the globe… [The] system that is meant to regulate the flows of tainted money is broken."
The files relate to alleged money-laundering transactions across several banks that took place over 17 years from 2000, and represent a total of around $2trn in suspicious activity.
This morning on the Hang Seng, HSBC shares shed 5.3%, bringing their value to US $3.78 -- the lowest since 1995. Standard Chartered, which is also alleged to have knowingly allowed dirty money to move around the globe, saw its shares fall by 6.2% in Monday trading in Hong Kong.
HSBC's shares have fallen by half since the start of the year, dogged by internal restructuring, the covid-19 outbreak in China and geo-political tensions between the US and China.
In a statement today, Standard Chartered said "there will always be attempts to launder money and evade sanctions . We take our responsibility to fight financial crime extremely seriously and have invested substantially in our compliance programmes."
HSBC declined to comment. The two British banks, which both have international operations weighted especially to Asia, are alleged to have ignored warnings from the US Department of Treasury's Financial Crimes Enforcement Network. According to reports, the US authorities repeatedly flagged transactions as suspicious in the years between 1997 and 2017, yet the banks stand accused of taking little or no action.
Subscribe to International Investment's free, twice-daily, newsletter
