HSBC to Pay a $1.9 Billion Wrist Slap on Failing to Stop Money Laundering

“This may be the world’s largest wrist slap.

British banking giant HSBC, Europe’s biggest bank, is set to pay $1.9 billion to settle accusations that it didn’t do enough to stop money laundering in its branches, the Wall Street Journal reported on Monday. According to the WSJ, the U.S. government could announce the deal as soon as Tuesday.

HSBC’s fine would shatter records for criminal and civil penalties paid by a bank, according to the WSJ. But it would not be more than investors had already expected. The bank on November 5 said it was setting aside $1.5 billion to cover potential penalties and warned it might have to pay a “significantly higher” amount. Reuters reported last week that the bank would likely soon settle for $1.8 billion.

Investors may well cheer the actual number. HSBC stock, which fell slightly on Monday in London trading, has gained 4 percent since the bank’s November 5 warning.”

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