HSBC is being investigated by the Reserve Bank of India after a US senate committee said the bank’s Indian staff mishandled checks to ensure the global banking giant was following norms that guard against money-laundering and terror-funding.
“Any financial institution that does not follow the norms laid being down, makes the nation vulnerable,” said Home Secretary RK Singh. The issue will be studied by the RBI as a regulatory matter, said Department of Financial Services Secretary DK Mittal.
A US Senate committee has found that the global banking giant failed in preventing money laundering by drug cartels and terrorists not only in the US, but also in other parts of the world, possibly including India. In its 340-page report, the committee also said that HSBC’s Anti-Money Laundering (AML) Compliance Department, which included employees in India, was highly inadequately staffed. The Indian staff involved in the process delivered sub-standard results, the committee said, pointing out that nearly one-third of the “alerts” flagged for review had to be de-done by the OCC (the US Office of the Comptroller of the Currency, which is the bank’s primary federal regulator in the country).
Detailed news link: click here