It’s no surprise to discover that banks think of profits over the potential cost that their business has in innocent human lives and in Mexico, London-based banking giant HSBC has proven this once again. As it turns out, they’ve been turning a blind-eye to drug-lord money and helping them (without their knowledge of course!) to launder it and move it from the country to the United States. In return for their contribution to the cartels, the Mexican government has hit HSBC with a massive $28 million fine - around half of the bank’s total profits for the entire year of 2011.
The accusations are that HSBC has been failing to properly monitor their accounts, resulting in tons of laundered money filtering through. It is estimated that billions have made their way through the bank in the last decade. Suspicious activity within the HSBC banking system was not investigated and even when they were warned about it, they failed to take action in a timely manner. Nearly 2000 suspicious transactions were reported late. These practices resulted in HSBC becoming, literally, the bank of choice for drug money laundering between Mexico and the U.S.
They have since changed their ways, following a crackdown in 2008, taking measures such as refusing to deal in cash transactions and being more discriminating in who they do business with. Considering the situation in Mexico is no secret, they probably should have been paying attention a little closer and a little earlier. The end result is the huge fine.
This is not the first time for fines to be levied against HSBC either. Usually they try to contest them, but in this case they’ve simply agreed to pay what the government asks. Of course, this is but one of their many growing problems, as the U.S. is planning on leveling fines of their own to the tune of around $1 billion. Hopefully, this hit against HSBC will make it more difficult for drug cartels to operate and perhaps even teach banks a lesson about their corrupt practices. Human lives cannot be measured in dollar amounts, no matter how “profitable” it may be.