HSBC to Pay $1.9B in Money-Laundering Probe

British banking giant was accused of helping cartels

By Newser Editors and Wire Services

Posted Dec 10, 2012 4:45 PM CST

(Newser) – A law enforcement official says HSBC will pay $1.9 billion to settle a money-laundering probe by federal and state authorities into Europe's biggest bank. According to the official, the bank will pay $1.25 billion in forfeiture and pay $655 million in civil penalties. The $1.25 billion figure is the largest forfeiture ever in a case involving a bank. Under what is known as a deferred prosecution agreement, the bank will be accused of violating the Bank Secrecy Act and the Trading With the Enemy Act.

The official spoke on condition of anonymity today because the source was not authorized to speak about the matter on the record. The London-based bank says it is cooperating with investigations but that those discussions are confidential. The settlement—a huge victory for the US government—arose from allegations that the British bank had helped Mexican drug cartels launder money and moved billions for Iran and other countries under sanctions, reports the New York Times.

A sign for HSBC bank is seen at a branch in the City of London, Monday, Aug. 3, 2009.
A sign for HSBC bank is seen at a branch in the City of London, Monday, Aug. 3, 2009.   (AP Photo/Sang Tan)
A sign outside a branch of the HSBC Bank, Croydon, Surrey, Britain, is seen in this March 1, 2007, file photo.
A sign outside a branch of the HSBC Bank, Croydon, Surrey, Britain, is seen in this March 1, 2007, file photo.   (AP Photo/Tom Hevezi, file)
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