Former Bank of England policymaker calls on HSBC chairman to quit

HSBC HQ London 2

A former member of the Bank of England’s financial policy committee has called on HSBC’s chairman to resign following the scandal at its Swiss operation and other debacles.

Robert Jenkins said Douglas Flint, chairman since late 2010, was partly responsible for HSBC’s takeover of the Swiss business because he was finance director at the time.

Leaked documents have since showed that HSBC’s Swiss banking arm ignored the illegal activities of arms dealers and helped wealthy people evade taxes.

Flint was also finance director when HSBC bought a Mexican bank that laundered drug money, and when it bought Household, a US subprime lender that cost HSBC billions, Jenkins said.

As a senior executive and chairman, Flint should have made sure the bank’s policies were carried out, he added.

“The tone at the top is set by the chairman and the board. For the good of his own reputation as well as that of his institution and British banking, Mr Flint should go,” Jenkins wrote in the Financial Times.

HSBC declined to comment.

Flint has said that the Swiss private bank’s enabling of tax evasion and aggressive tax avoidance was “totally humbling”. But he said Swiss rules and HSBC’s decentralised structure obscured what was going on at the business, and he refused to be held personally accountable.

Jenkins said it made no sense for Flint to acknowledge he was responsible for HSBC’s businesses but also claim he was not accountable.

Jenkins quoted a speech Flint made two years ago in which he said: “[Banking] supervisors should care more about tone at the top, how ethics and values are taught and reinforced, how values are enforced and rewarded, and how an organisation looks for and adapts to changing expectations within the communities it serves.”

From 2011 to 2013, Jenkins was a member of the Bank of England’s financial policy committee, which monitors risks to the financial system. He has been a harsh critic of banks, accusing them of trying to avoid rules to make them safer in order to shore up profits.

Powered by Guardian.co.ukThis article was written by Sean Farrell, for theguardian.com on Wednesday 11th March 2015 17.31 Europe/Londonguardian.co.uk © Guardian News and Media Limited 2010

 

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