With HSBC, Mexico's involvement entailed providing money-laundering services to various drug cartels, including bulk movements of cash from the bank's Mexican unit to the U.S., with little or no oversight of the transactions. It also conducted transactions with Iran, removing references to the country in an effort to conceal them.
Lacking in these instances is a corporate culture that prizes integrity. Enabling the business of drug running and state-sponsored terrorism in the pursuit of profit leads to dire societal consequences. Blame may be placed at the foot of the banks and regulators alike. In the former instance, inadequate anti-money laundering (AML) controls were principally at fault. In the latter, the Office of the Comptroller of the Currency (OCC) failed to crack down on HSBC's deficient implementation of controls. Indeed, prior to 2010 when the OCC cited the bank for many AML deficiencies - including a huge backlog of unreviewed accounts and failure to file Suspicious Activity Reports (SARs) - for the previous six years the agency failed to take any enforcement action against the bank.
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