Once upon a time, we thought that having the Mossad, in league with litigious victims of terrorism, beating you about the head and shoulders in courts foreign and domestic would be enough to deter giant foreign banks from thumbing their noses at UN and US anti-money laundering laws. In the case of HSBC, a sane person might also conclude that paying a fine big enough to choke a Saudi shiek might do the trick. If he or she thought that, he or she would, according to at least one whistle-blower, be dead wrong.
[A] former employee is alleging that the bank continued to break anti-money-laundering rules even as it claimed to be reforming its controls, and he has asked federal authorities to open a new investigation.
Everett Stern, who worked in HSBC Bank USA's anti-money-laundering division in 2010 and 2011, unveiled the allegations Thursday at a protest against the bank in New York. In March, Stern and the law firm Berger & Montague submitted his evidence — which includes internal emails and other documents he collected while working at the bank — to the Securities and Exchange Commission, the Justice Department and banking regulators, claiming that the bank continued to flout money laundering rules while he was employed there.
What's especially surprising is that, as part of its deal with US authorities, HSBC agreed to a five-year deferral of criminal sanctions against the bank and its executives. The deferral is contingent on the bank's good behavior. According to Mr. Stern, the bad boys continued their wrongful ways, evidencing a cavalier attitude toward the prospect of being incarcerated in a minimum security federal country club, where, for an extended period of time, you have to carry your own bag around the golf course. Well, that, and you might be forced to adopt the name "Sweetcakes" by a guy with a bad case of roid rage.
Stern was one of the people hired by the bank to "cure their problem," the "problem" being the laundering of money for terrorist organizations through the bank. Instead of "solving the problem," Stern alleges that the bank adopted a "wink-wink, nudge-nudge" system that, if his allegations are true, was a smoke-and-mirrors attempt to make the regulators think that the bank was trying to comply with AML regulations while allowing hundreds of millions of dollars to be washed, rinsed, and nicely dried by known "financiers of terrorists."
Here's one possible sanction, should Stern's accusations prove to be true: kick the bank out of the United States. If you're going to launder money for people who want to wipe us from face of the Earth (along with all those nasty Israelites), why are we allowing you continue to operate within our borders? Then again, if we start down that path, I suppose we'll have to kick our own big banks out of this country, as well, since other deterrents don't seem to work, and that would never...
Wait a minute! I think that this might be worth further consideration. I'll have a couple more Shiner Bocks and ponder this while watching the latest episode of "Boardwalk Empire" for tips on dealing with this particular brand of bad-boy bankers.