POLITICS

HSBC Scandal: Labour's Chris Leslie Demands Answers From Stephen Green Over Laundering Allegations

21/07/2012 18:08 | Updated 21 July 2012

The Labour Party is piling pressure on trade minister Lord Green to make a public statement about what he knew of allegations that HSBC was engaged in money laundering while he was in charge of the bank.

Last week a US Senate committee sensationally accused the British banking giant of facilitating money laundering for drug king pins, rogue states and terrorists.

In a letter sent to Lord Green on Saturday by Labour shadow Treasury minister Chris Leslie, the Tory minister, who was chairman of the bank between 2006 and 2010, is asked to "account for his actions".

"As you will know, the US Senate Homeland Security Sub Committee on Investigations this week reported on a series of significant alleged failings at HSBC Bank during your tenure as chief executive and chairman," Leslie writes.

"As a senior government minister with an ongoing role in banking policy, I would be grateful if you could place on the record – at the earliest opportunity - an assurance that you took every appropriate step if and when you became aware of the issues raised by this report.”

Leslie says that it is a matter of "significant public interest" that Lord Green explain what, if anything, he was aware of during his time at the bank.

In particular Leslie has demanded to know what he knew about the alleged circumvention of safeguards designed to block transactions to those with potential links to drug cartels, rogue regimes or terrorist organisations.

"It is important that Ministers are seen to be as open as possible with the public and to account for their actions," he says.

On Tuesday HSBC apologised after a US Senate investigation accused it of, among other suspect activities, providing services to some lenders in Saudi Arabia and Bangladesh believed to have helped fund al Qaeda and other terrorist groups.

Senator Carl Levin, the chairman of the subcommittee investigating the bank, said the culture of HSBC's non-UK subsidiaries had been "pervasively polluted for a long time" and said senior executives in London "knew what was going on but allowed the deceptive conduct to continue".

Lord Green, who stepped down from the top job at the British banking giant in 2010 after being appointed to government by David Cameron, has so far not spoken publicly about the allegations.

Seizing on the scandal, the Labour Party has twice asked that the Tory peer to answer questions about it in the House of Lords - requests that have been rebuffed.

The government has insisted that ministers are only accountable to parliament for decisions they take while in office, not for their actions before taking office.

Lord Green joined HSBC in 1982 and rose through the ranks before becoming chief executive in June 2003 and was appointed chairman in 2006.

As the Huffington Post UK reported last week, Lord Green was made aware of the bank’s alleged ties with “rogue” regimes in the Middle East in 2005.

And the US Senate investigation has released internal emails showing how in the same year Lord Green was warned by an internal whistleblower in the bank’s Mexico subsidiary that compliance staff had “fabricated records”.

He was also told in 2008, two years after being appointed executive chairman, that the Mexican authorities had uncovered evidence of money laundering that “may imply criminal responsibility of HSBC”.

Suggest a correction
Comments

CONVERSATIONS