Abigail Hofman: HSBC’s fall from grace

By:
Abigail Hofman
Published on:

HSBC’s advertising slogan for many years was the "world’s local bank", now media headline writers are dubbing the bank: "The world’s local money launderer". Always considered conservative, well run and frankly a bit stodgy, HSBC has stumbled badly. And we are all like stunned moles blinking in the sunlight, following a 340-page report from a US Senate subcommittee accused HSBC of laundering cash for terrorists, drug barons and dictators through many of its subsidiaries.

The bank allegedly breached US trade sanctions against Iran, Cuba, Sudan, Burma and North Korea. Such lawlessness is surprising and is certainly the antithesis of Bob Diamond’s quest to turn bankers into good citizens. However, the episode also raises questions about the complicity or otherwise of former senior executives such as Sir John Bond, Lord Green and Mike Geoghegan.

I am particularly outraged about the revelations because the bank always treated me as a criminal. For several years, I was a client of the private bank. Ironically, I closed it in May – a few weeks before these money-laundering allegations surfaced. I closed my account because the private bank was so cumbersome to deal with. In this day and age, most private banks accept instructions over the phone or by email. However, with HSBC, if I wanted to move money from the account, I always had to send a fax and normally they had to call me back to check that I was the person who had sent the fax. Such bureaucratic and inflexible procedures smack of locking the stable door after the horse has bolted. Were HSBC as rigorous, I wonder, with their customers who were Russian criminals, supporters of Islamic terrorists and Mexican drug dealers? Or is it just the ‘little people’ whom they seek to inconvenience?