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jul

HSBC shipped billions in cash to US on behalf of Mexico’s drug cartels

Anti-money laundering controls need to be tightened, says Mexican regulator

British banking giant HSBC for years shipped billions of dollars in cash belonging to the Mexican drug cartels to be deposited in the United States despite warnings from banking regulators in Washington and Mexico City, according to the results of a US Senate investigation released on Monday.

The more than 400-page report compiled by the Senate’s Permanent Subcommittee on Investigations was made public on the eve of a hearing in which officials from HSBC Holdings Plc were called to before the panel to explain how the bank acted as a financier to shady clients in Mexico, Iran and Syria by routing their money to the United States.

According to the executive summary of the report, HBMX was “the single largest exporter of US dollars” to the United States between 2006-2007, shipping over $7 billion in cash.

“Mexican and US authorities expressed repeated concern that HBMX’s bulk cash shipments could reach that volume only if they included illegal drug proceeds,” the summary stated “The concern was that drug traffickers unable to deposit large amounts of cash in US banks due to [anti-money laundering] controls, were transporting US dollars to Mexico, arranging for bulk deposits there, and then using Mexican financial institutions to insert the cash back into the US financial system.”

The US Justice Department is currently investigating the bank’s dealings.

elpais.com