The pieces of the complex drug trafficking puzzle are falling into place with the revelation that one of the world’s largest banks, HSBC, laundered $7 billion for Mexican drug cartels.
The report by the Senate’s Permanent Subcommittee on Investigations showed that the permissive attitude of Europe’s largest bank was not limited to the neighboring country: the bank also handled Islamic terrorism funds through a Saudi bank in addition to Iran.
According to the report, for a decade the bank placed little importance on its internal office responsible for monitoring money laundering and in 2007, when the section’s chief requested more resources, she got fired. That same year, HBMX, the bank’s Mexican subsidiary, sent $3 billion to the United States.
Why the bank initially classified Mexico as posing a minimal risk of money laundering, a classification that lasted from 2001 to 2009, is inexplicable. What is known is that during this period, the bank participated in numerous transactions with exchange bureaus and thousands of Cayman Islands accounts, among others.
The bankers yesterday apologized to a Senate panel and assured its members they have implemented controls. They blamed the bank’s fast expansion and a decentralized management structure.
These are technical definitions that are too cold to explain crimes in which the bank is an accomplice in tens of thousands of deaths of Mexicans that are connected to drug trafficking. These bankers are essential for a mafia that has Mexico in a chokehold.
The problem is that in this case, as happened before with Wachovia, multimillion-dollar fines that set new records are imposed on the bank, but they usually total less than the profits from the illicit transactions. In the end, the fine is a business expense.
The story would be different if bank officers involved in key decisions that allowed money laundering were to face criminal charges for their responsibility in the crimes. But this is not the case.
We think the way to avoid a repeat of this situation starts with a Mexico-U.S. investigation undertaken within the context of the war on drugs instead of being a sterile banking crime. The day bankers are imprisoned for crimes committed through bank policies, surely there will be fewer cases like this.