July 19, 2012

HSBC Executive quits over Bank's Links to Money Laundering

Top compliance executive David Bagley of the international bank HSBC has resigned on Tuesday. The British bank is accused of giving terrorists and criminals access to the US financial system by failing to guard against money laundering. 

Bagley was among at least six HSBC executives who was present before the Senate’s Permanent Subcommittee on Investigations on Tuesday after the panel in a 335-page report described a decade of compliance failures by the international bank. 

Senate investigators alleged that the British bank had allowed the drug lords to launder money in Mexico, was associated with the firms linked to terrorism and concealed transactions that bypassed the US sanctions against Iran. 

“As I have thought about the structural transformation of the bank’s compliance function, I recommended to the group that now is the appropriate time for me and for the bank for someone new to serve as the head of group compliance,” David Bagley told the Senate panel in Washington.

Bagley apologised to the US lawmakers for failures at the bank. He was head of compliance for London-based HSBC Holdings since 2002.

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