‘Dirty money’ scandal: HSBC & StanChart shares dip

The shares of the global banking giants HSBC and Standard Chartered Hong Kong fell on Monday to their lowest since at least 1995 as the US financial crime data revealed their involvement in “dirty money.”

Files released by the US Department of Treasury’s Financial Crimes Enforcement Network (FinCen) and the US Financial Crimes Investigation Network unveiled the involvement of the major global banks in moving large amounts of allegedly illicit funds nearly for two decades despite the red flag regarding the source of the money.

The files show that about $2 trillion worth transactions were made between 1999 and 2017, which were flagged as suspicious by the internal compliance departments of these financial institutions.

The FinCen inquiry files show that even after being sued and fined for their misconduct, more banks like JPMorgan Chase, Deutsche Bank and Bank of New York Mellon are getting involved in suspicious money crimes.

The HSBC shares in London fell 5.33 percent to close below $3.87 after the lenders share in Hong Kong fell to 4.4 percent their lowest level since 1995. The stock has now nearly become 50 percent since the start of this year. The British banking group Standard Chartered saw its lowest share since 1998 as it dropped as much as 4.6 percent in London.

The FinCen files disclose a basic truth about the modern era: the network through which illicit money moves over in the world has become an important artery of the global economy. They enable a shadow financial system so wide-ranging and so unchecked that it has become inseparable from the legitimate economy and the banks with household names have aided it.

More than 2,100 suspicious activity reports were obtained by the media and shared with the International Consortium of Investigative Journalists (ICIJ) and they says that these leaked documents are just a small fraction of reports filed with the FinCen.

The London-based HSBC and Standard Chartered along with other global banks have violated the US sanctions on Iran and anti-money laundering rules and were forced to pay billions of dollars as fine in recent years.

Global banks have promoted investments on technology and staff to deal with harsh anti-money laundering and sanctioned regulatory requirements across the world in recent years.