HSBC takes its name from its roots as the Hongkong and Shanghai Banking Corporation, but there has long been a joke inside and outside the firm that the name stands for 'How Simple Became Complicated'.
Reuters reports that that complexity in part explains how the London-based bank ended up with the biggest fine ever imposed on a financial firm by U.S. regulators on Tuesday - an eye-watering $1.9bn - after a lengthy U.S. probe showed sweeping problems at the bank. Lax controls had left HSBC as the "preferred financial institution" for drug traffickers and money launderers, U.S. prosecutors said this week.
The concern is that HSBC, Europe's biggest bank, with more than 60 million customers across 84 countries, is unable to adequately monitor all its operations, a task made harder by its history of patchwork acquisitions.
HSBC said it has spent hundreds of millions of dollars to bolster compliance and simplify its control structure to address the lapses in anti-money-laundering controls, mainly in its Mexico and U.S. operations, which led to stinging criticism from politicians and the record punishment.
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