Lord Stephen Green, the UK trade minister who ran HSBC when the bank facilitated criminal money laundering, faces calls to reveal what he knew and when.
The Conservative trade minister has “serious questions to answer” about his role with HSBC after the bank’s apology to the US Senate for its failure to stop money laundering, said Chris Leslie MP, Labour’s Shadow Financial Secretary to the Treasury.
Lord Green’s spokesman told Channel 4 News today that the minister had no immediate comment. Nor was the peer prepared to answer questions in the House of Lords.
Lord Green was also chairman of the British Banking Association during the Libor scandal that has so far resulted in a £290m fine for Barclays and several ongoing international investigations.
In November, Lord Green, who is also an ordained Church of England priest, was asked to support Mr Osborne on Treasury matters, “in particular financial services and banking issues. He is already a member of the cabinet committee for banking reform,” the Treasury website said.
The US subcommittee’s report on HSBC found drug money from Mexico was almost certainly laundered through the bank, which also handled questionable funds from the Cayman Islands, Iran and Saudi Arabia in a “polluted” system.
“The US Senate sub-committee’s report, which suggests that HSBC allowed money laundering by drug cartels and possibly even terrorists, is so serious that the bank’s head of compliance has already resigned,” Chris Leslie said in a statement.
HSBC’s group head of compliance David Bagley told the Senate committee he would step down on Tuesday. The committee is investigating HSBC’s activities between 2006 and 2010 when Lord Green headed the bank.
Senate rpt shows Bagley, HSBC exec who’s quit, emailed Lord Green Jan 05 tht $2.9m Burma deal had “significant risk of financial penalty”
— Michael Crick (@MichaelLCrick) July 18, 2012
“Why is Lord Stephen Green Tory Trade minister who was Exec Chairman of HSBC at time of latest banking scandal not being pursued by media?” Labour Peer George Foulkes tweeted.
“Baroness Wilcox revealed Lord Green had answered only 2 oral PQs & spoken in 3 debates in Lords in 2 years,” Mr Foulkes added.
Lord Green was chief executive officer of London-based HSBC from 2003 to 2006 and then chairman up to 2010. He was appointed to the House of Lords when Prime Minister David Cameron made him trade minister in 2011.
For its part, HSBC said it is cooperating with the US Justice Department over possible Iran sanctions violations and with others investigations by the Justice Department and the Internal Revenue Service.
HSBC said in a statement: “We will apologise, acknowledge these mistakes, answer for our actions and give our absolute commitment to fixing what went wrong.” The bank said there has been a change of senior management and compliance rules to prevent money laundering have been strengthened.
HSBC, the only UK bank with US branches, now faces a “substantial” fine of up to $1bn (£640m).