HSBC apologises for Swiss branch’s past actions

HSBC now claims to put transparency above profitability Keystone

Under mounting pressure from the Swiss Leaks revelations, HSBC's boss apologised on Sunday for the role played by its Swiss branch in helping clients evade taxes. The bank also claimed to have turned over a new leaf.

In an open letter addressed to HSBC customers, shareholders and colleagues, chief executive Stuart Gulliver apologised for the bank’s past actions. He claimed that the whole episode was a “painful experience” for the group.

“We must show we understand that the societies we serve expect more from us. We therefore offer our sincerest apologies,” stated the letter.

Sorry but…

However, the bank’s attempt to address the Swiss Leaks revelations was far from a simple letter of apology. The bank stated that the media coverage of the data stolen by ex-employee Hervé Falciani must be put into context.

“Many of the people mentioned have no allegation of wrongdoing against them whatsoever but been named simply because they are well-known individuals,” the bank stated.

It also disputed the 100,000 clients figure mentioned in the media, claiming that the Swiss private banking arm only had 30,000 clients at its peak. In addition, HSBC questioned the accuracy of the stolen data suggesting that it could have been manipulated.

“It is unclear if the integrity of the data has been preserved, or even if the original data itself was complete and accurate. Recent allegations by a French law enforcement official in Nice, suggest that the data has been manipulated and could therefore contain material inaccuracies,” said another statement released by the bank.

Lesson learned?

HSBC also claimed that it no longer the same bank it was eight years ago.

“We have absolutely no appetite to do business with clients who are evading their taxes or who fail to meet our financial crime compliance standards,” stated the letter.

The bank also pointed to an update showing the progress that has been made in overhauling the bank’s practices since 2007. Measures stated include withdrawal from markets where due diligence is difficult and annual review of politically exposed persons. It claims the latest figures show that it has “put compliance and tax transparency above profitability”. 

The Swiss private bank has reduced the number of clients by almost a third, from 30,412 accounts in 2007 to 10,343 in 2014.  It also slashed the amount of assets under management from $118.4 billion to $68 billion within the same period.