HSBC Fined $27.5 Million in Mexican Money-Laundering Probe
The infringements relate to the late reporting of 1,729 unusual transactions and the failure to report 39 others, the London-based bank said in a statement today.
HSBC Mexico is “aware of the importance of strengthening compliance and risk management controls for the overall financial system,” it said in the statement. “It has already taken actions and invested resources to address the past failures for which it has been fined.”
HSBC executives have been grilled by U.S. lawmakers this month over claims that bank affiliates gave terrorists, drug cartels and criminals a portal into the U.S. financial system by failing to guard against money laundering.
The fine is the largest levied by Mexico’s banking regulator, Guillermo Babatz, president of the National Banking and Securities Commission, or CNBV, said in an interview broadcast in Mexico by Radio Red. Other banks operating in Mexico are being fined for similar reasons, though for lesser amounts, he said, without providing details.
HSBC has taken steps including closing accounts where there is “insufficient information” about a customer or if they are considered “high risk,” the bank said. The unit stopped the purchase, sale and deposit of U.S. dollars in cash at branches on Jan. 1, 2009.
The bank paid the fine this morning for “grave” administrative failures that have since been corrected, HSBC Mexico’s chief Luis Pena Kegel said in an interview on Radio Red. The fine hasn’t affected HSBC Mexico’s finances, he added.
“The bank today is very different from the bank that was subject to fines,” Pena Kegel said.
To contact the reporter on this story: Nacha Cattan in Mexico City at email@example.com.