Money Laundering and The Drug Trade: The Role of the Banks

May 9th, 2013

Published on Global, by Dylan Murphy, May 07, 2013.

… One thing the American government has not done is to prosecute the largest banks in the world for supporting the drug cartels by washing billions of dollars of their blood stained money. As Narco sphere journalist  Bill Conroy has observed banks are ”where the money is” in the global drug war … //

…  In December 2012 the Department of Justice cut a deal with HSBC which imposed a record $1.9 billion dollar fine. It may sound a lot to ordinary folks but it is a tiny fraction of its annual profits which in 2011 totalled $22 billion. Assistant Attorney General Lanny Bauer announced the settlement at a press conference on 11 December 2012. His comments reveal why the US government decided to go soft on such criminal behaviour and show quite clearly how there is one law for the richest 1% and one law for the rest of us. Lenny Bauer said:

Had the U.S. authorities decided to press criminal charges, HSBC would almost certainly have lost its banking license in the U.S., the future of the institution would have been under threat and the entire banking system would have been destabilized.”

Think about that statement for a moment. A bank that has quite clearly been caught out helping murderous drug criminals, terrorist groups, third world dictatorships and all sorts of criminal characters is to be let off with a slap on the wrist. No criminal prosecutions or even a mention of criminal behaviour due to the fears that to do so would put the world economy in jeopardy. So there you have it. Banksters who engage in such behaviour that is regarded as criminal by the vast majority of people on the planet are not only too big to fail they are also too big to jail.
After the Department of Justice announcement of the deferred prosecution HSBC Chief Executive Stuart Gulliver said,”We accept responsibility for our past mistakes. We have said we are profoundly sorry for them, and we do so again.”

Such statements will provide little solace to the families of the 150,000 people estimated by US Secretary of Defence Leon Panetta to have been killed in Mexico’s drug war. Nor will it help the hundreds of thousands of Mexican citizens who have been forced to flee their homes and escape the violence by going to the United Sates or moving to other parts of Mexico.

Senator Elizabeth Warren appearing at a meeting of the Senate Banking Committee in February expressed frustration with officials from the US Treasury Department and US Federal Reserve over the issue of why criminal charges were not pressed on HSBC or any of its officials. The officials were evasive when she tried to draw them on the issue of what it takes for a bank to have its licence withdrawn:

HSBC paid a fine, but no one individual went to trial, no individual was banned from banking, and there was no hearing to consider shutting down HSBC’s activities here in the United States. So, what I’d like is, you’re the experts on money laundering. I’d like an opinion: What does it take — how many billions do you have to launder for drug lords and how many economic sanctions do you have to violate — before someone will consider shutting down a financial institution like this?”

Senator Warren finished the session by commenting on the glaring double standards within the US justice system:

You know, if you’re caught with an ounce of cocaine, the chances are good you’re going to go to jail. If it happens repeatedly, you may go to jail for the rest of your life. But evidently, if you launder nearly a billion dollars for drug cartels and violate our international sanctions, your company pays a fine and you go home and sleep in your own bed at night, every single individual associated with this. I think that’s fundamentally wrong.”

On 4 March 2013 HSBC announced profits of $20.6 billion in 2012 while it paid out a $3 million bonus to its CEO. This outrageous state of affairs beggars belief after HSBC has been clearly caught out engaging in activity on behalf of murderous drug lords, terrorist financing banks and brutal third world dictatorships. Where is the British Government’s condemnation of HSBC? You may be waiting a long time for that considering the fact that Chancellor George Osborne and his fellow ministers are intimately connected to the British banking elite.

Long time observer of the Mexican drug war Bill Conroy comments that the deal cut with HSBC by the Department of Justice, ”should illuminate for all the great pretense of the drug war — no matter how hard US prosecutors, via the mainstream media, attempt to convince us otherwise. …And it should lead us to conclude, if we are honest with ourselves, that the so-called drug war is little more than one immense “drug deal.”

(full text).


Association of Certified Financial Crime Specialists has observed;

Homeland Security and Governmental Affairs
issued a 339 page report;

HSBC supplied Al Rajhi bank: U.S. Vulnerabilities to Money Laundering, Drugs, and Terrorist Financing: HSBC Case History, 5.24′13 h,
also on Homeland Security and Government Affairs: permanent subcommittee on Investigations;

How HSBC Hooked Up with Drug Traffickers and Terrorists, And Got Away with It, on News, February 14, 2013.

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