Cobrapost sting operation nails Stanchart, HSBC officers on camera
19 June 2013
After Cobrapost expose that led to ICICI, HDFC and Axis banks being fined by the Reserve Bank of India (RBI) for flouting KYC norms and laundering unaccounted money from wealthy customers, the online magazine has now exposed in its latest post, how some executives of the two foreign banks in India were also involved in accepting black money to launder it.
Following the sting operation, the Income Tax Department issued notices to ICICI, HDFC and Axis banks with the RBI even levying hefty fines on them. Senior bank officials, however, confirmed on camera that money laundering was a service offered by all.
A Cobrapost undercover reporter posed as a politician's aide and was offered lockers by HSBC and Standard Chartered officers to stash away unaccounted money.
Reacting to the latest sting operation, HSBC suspended employees who were seen soliciting black money on camera. "HSBC has a zero-tolerance policy for breaches of law and regulation and the bank takes seriously any reports or allegations of such breaches. As soon as we were informed of the CNN-IBN news report, we launched an immediate investigation including to determine whether any accounts were opened or any transactions similar to those described in the conversations reported by CNN-IBN ever took place. Our employees featured in the news report are on leave pending completion of the investigation. We will take appropriate action, including dismissal, if any employee is found after investigation to have breached the law or our policy," HSBC said in a statement.
Meanwhile, Cobrapost alleged in a post, ''It is not just the home grown banks that have failed in maintaining their code of ethical banking. Even personnel of foreign banks that India has welcomed to set up shop on its soil are equally guilty of misconduct.''
In a departure from earlier editions of the operation, which was made public in press conferences, Cobrapost tied up with a TV channel for the latest expose and unlike earlier, it came across some exceptions in its assembly line of ''money laundering'' bankers.
''Our investigation across the banking industry in the country has revealed a progressive deterioration of banking ethics and fierce violation of financial norms. However, not all is dark and grim in the Indian banking sector. Out of hundreds of banking personnel whom Cobrapost reporter interacted with across the country, there are a few bank managers who stood out as redemptive icons of the Indian banking industry. This special feature is dedicated to these 5 bankers who upheld the ethics and principles of banking."