HSBC chief takes swipe at previous management

The chief of UK lender HSBC has taken a swipe at the previous management reaching a settlement with US investigators that would see the bank pay a hefty fine totalling $1.92 billion - one of the largest penalties ever handed down to a major financial institution. (See: HSBC nears $1.8-bn deal to settle money-laundering charges) 

Apologising for the failures that led to HSBC handling billions of dollars linked to drug trafficking, Group CEO Stuart Gulliver said the company was ''a fundamentally different organisation from the one that made those mistakes".

He added, over the last two years, under new leadership, the bank had been taking concrete steps to put right what had gone wrong.

Under the deferred prosecution agreement with the US Department of Justice, Gulliver and the rest of HSBC's senior managers would see a portion of their bonuses withheld over the five-year period of the deal. The bank was spared prosecution partly to protect thousands of jobs.

Deferred prosecutions have become an increasingly popular way for federal prosecutors to penalise companies without running the risk of forcing them out of business by indicting them.

The record fine came for HSBC's failure to enforce money laundering rules. The investigations also found evidence of the role of the bank in moving cash for Mexican drug cartels and for banks in rogue states including Iran and Libya.