HSBC is Paying $2 Billion, Or 5 Weeks’ Worth of Its Profit, to Avoid Criminal Charges in Drug Cartel Laundering Case!

• HSBC is paying $2 billion, or 5 weeks’ worth of its profit, to avoid criminal charges in drug cartel laundering case! 
  by Brett Wolf and Aruna Viswanatha, Thomson Reuters, via http://www.globalpost.com/ 
  US regulators continue to find weaknesses in the way HSBC Holdings tries to prevent money laundering, according to people familiar with the matter, even after the British bank was forced to pay nearly $2 billion in penalties and invested millions in increasing its compliance.
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  The deferred prosecution agreement was reached in December 2012 and was approved Monday. The settlement was seen as a record amount to resolve charges that the bank failed to stop billions of dollars in drug money from flowing through the bank from Mexico.
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  Under the terms of the deal, the Justice Department agreed to suspend criminal charges against HSBC and its US subsidiary for five years if the bank agreed to pay the penalty.
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  When announcing the settlement, HSBC Chief Executive Stuart Gulliver said: “The HSBC of today is a fundamentally different organization from the one that made those mistakes.”
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  But examiners from the Office of the Comptroller of the Currency have continued to find problems, two people familiar with the matter said. They said that the regulator told the bank late last year it has not seen enough improvement in the bank’s controls in its correspondent banking business, which processes transactions for financial institutions around the world, including HSBC units.
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  Sources declined to provide further detail about the nature of the weaknesses. The sources declined to be named because they were not authorized to speak publicly about the internal changes or the communication with regulators.
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  While none of the people suggested HSBC could face another regulatory or enforcement action at this point, the assessment by the authorities shows how difficult it is for the bank to resolve the issues.
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