We have covered HSBC frequently here on SFW, but Forbes and Reuters have just broken a story that paints a picture of HSBC as a financial institution out of control when it comes to vigilance against money laundering.

We first reported on HSBC’s deplorable money laundering policies almost a year ago when it was announced they would be fined $1 billion for lax compliance:

http://www.shariahfinancewatch.org/blog/2011/05/24/hsbc-to-be-fined-1-billion-for-lax-money-laundering-compliance/

Couple HSBC’s deplorable money laundering vigilance with the fact that they are one of the world’s most active participants and promoters of Shariah Finance and you end up with a worrisome combination indeed.

Just take a look at our entries with regard to HSBC over the years:

http://www.shariahfinancewatch.org/blog/category/hsbc/

There is scarcely a financial institution more deeply involved with Shariah Finance than HSBC. Readers should recall that for years the chief of HSBC’s central shariah committee was the vicious jihadist, Mufti Taqi Usmani:

http://www.shariahfinancewatch.org/blog/2009/02/27/hsbcs-shariah-man/

With clear ideological ties to the Taliban, no Western financial institution had any business employing Usmani.

HSBC got the message eventually on Taqi Usmani, but in a move that demonstrated profound cynicism and arrogance, HSBC replaced him with his own son, Dr Muhammad Imran Ashraf Usmani.

The younger Usmani is considered antiseptic enough for Western financial institutions and has no known Jihadist writings that have been translated into English, unlike his hateful, Jihadist father.

Readers should be aware, however, that the younger Usmani’s education background indicate the same disturbing traits as his father. In fact, he was educated at the same Taliban-related madrassa in Pakistan.

These are the people with whom this large international financial conglomerate with a horrible record on money laundering choose to do business.

It would be nice if regulators would look much deeper into HSBC’s activities in Shariah Finance:

• Who are its Shariah advisors? What are their backgrounds and affiliations?

• How has HSBC facilitated the promotion of Shariah globally, as is the stated goal of Shariah finance?

• How much has HSBC paid out in zakat? Where has this zakat money gone?

Given that regulators at the US Treasury have shown very little curiosity when it comes to these issues and have, in fact, promoted Shariah Finance themselves, perhaps the best we can hope for is that people in the West will recognize HSBC for what it is and make their personal financial decisions accordingly.

Here is a link to Forbes’ latest article on HSBC:

Drugs, Terrorism And Medicare Fraud: HSBC’s Messy Money Laundering
Investigations

Suddenly the biggest scandal in banking might not be about mortgages or bailouts. Instead, money laundering is allegedly rampant at banking giant HSBC.

Reuters has a very juicy exclusive on the British bank’s alleged illegal dealings that involve drugs, terrorism and medicare fraud.

Almost a decade ago federal banking regulators  investigated HSBC, the 5th largest bank in the world, for sloppy work in its anti-money laundering group. The regulators asked the bank to clean up its act but it seems little cleaning was done. Instead, the problems may have gotten worse according to documents obtained by Reuters.

HSBC is apparently facing several investigations about its internal compliance abilities.

Reuters notes that “the Justice Department, the Federal Reserve, the Office of the Comptroller of the Currency, the Manhattan district attorney, the Office of Foreign Assets Control and the Senate Permanent Subcommittee on Investigations are scrutinizing client activities such as cross-border movements of bulk cash, and transactions linked to Iran and other parties under U.S. economic sanctions.

http://www.forbes.com/sites/halahtouryalai/2012/05/03/drugs-terrorism-and-medicare-fraud-hsbcs-messy-money-laundering-investigations/

And here is a link to the work done by Reuters on the subject:

http://www.reuters.com/article/2012/05/03/us-hsbcusa-probes-idUSBRE8420FX20120503

 

 

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