Cost of Doing Business with Banks Funding Terrorists: Er…Not Much
In September I stuck up a post about Lanny Breuer (asst. AG) in a speech telling the NYC Bar Association that deferred prosecutions are the way to go because they increase corporate accountability. Seriously. The video of his speech is either truly creepy or hilarious, depending on your mood (my bolds throughout).
To be clear, the decision of whether to indict a corporation, defer prosecution, or decline altogether is not one that I, or anyone in the Criminal Division, take lightly. We are frequently on the receiving end of presentations from defense counsel, CEOs, and economists who argue that the collateral consequences of an indictment would be devastating for their client. In my conference room, over the years, I have heard sober predictions that a company or bank might fail if we indict, that innocent employees could lose their jobs, that entire industries may be affected, and even that global markets will feel the effects. Sometimes – though, let me stress, not always – these presentations are compelling.
So … let’s see; sober people (by which we can assume he means ‘serious’ people) have convinced the Justice Department that putting some asshole criminal bankers in prison would topple the financial system and cause global markets to shudder and shiver, O MY!
We’ve just learned that the DoJ decided that secretly laundering hundreds of millions of drug cartel money through their banks globally will cost HSBC…$1.92 billion in a settlement that includes…no criminal prosecutions. But, oh, my stars, the folks at HSBC promise never to do such careless stuff again! Neil Barofsky says that there were also hundreds of millions of more dollars of illegally disguised transactions with ‘rogue’ nations such as Iran and Sudan.
Neil Barofsky calls the story ‘Too Big to Jail’, and our banking systems’s latest disgrace, but of course, the real disgrace is the DOJ’s giving the sixth largest multinational company a Stay Out of Jail Free card.
Still, knowing who some of the recipients of the cleaned cash were,, and which banking officials had instructed the miscreants on how to hide pertinent information in the wire transfers in order to avoid prosecutions for trading with nations under US sanctions, I grew curious about there being even more to this story, and started poking around, and then a lightbulb went off in my head:
Who is the Most Impeccable Spelunker of Facts contained in reports whose perusal would make our eyes cross at first glance? Yes, Emptywheel. And yeppers, yesterday she wrote ‘Lanny Breuer Covers Up Material Support for Terrorism’.
Digging into the Permanent Subcommittee on Investigations report on on HSBC’s Bank Secrecy Act and money laundering violations, she found they pertained to:
Money laundering for Mexican cartels; Helping banks evade sanctions; Processing masses of travelers checks from Hokoriku bank in Japan which had suspicious ties to Russian “businessmen”; and Maintaining correspondent accounts with banks that had ties to terrorism, most notably the Al Rajhi bank:
One of the things, according to Carl Levin, that HSBC did was help banks involved in terrorist financing get US dollars (that section takes up 53 pages of a 340 page report). And yet, Breuer’s speech did not once mention the word terrorism. The US Attorney’s release used the word “terror” once, though not in conjunction with HSBC. And the Statement of Facts mentions terrorism in conjunction with a description of the laws HSBC violated and in this one paragraph.
In addition to the cooperative steps listed above, HSBC Bank USA has assisted the Government in investigations of certain individuals suspected of money laundering and terrorist financing.
In short, Lanny Breuer and his prosecutors did not mention that this bank they were letting off without prosecution provided a terrorist-connected bank with US dollars for years.
Rather than prosecute HSBC for helping a bank with ties to al Qaeda get US dollars that might be more easily used in terrorist attacks, Lanny Breuer is slapping them on the wrist and pretending the terrorist financing aspect of HSBC’s violations doesn’t even exist.
Do read what she found on: HSBC, the US-dollar cow for a terrorist-linked Saudi bank Al Rajhi. The hypocrisy is stunning in many ways, including the fact that:
HSBC had ties to a crime that DOJ currently has someone sitting in prison for, and is still pursuing at the appellate level. Yet not only didn’t DOJ indict HSBC for that crime, but they don’t even think HSBC’s role in it is worth a mention. (Pete Seda), although EW says he’s sitting in a Colorado jail)
This, as so many stories in this country these days, is not just two-tiered justice. It’s NO JUSTICE for elites who are too well-connected to jail, and banks that are thought to be so systemically important that jailing some of the criminals would be undesirable.
Yep; it’s gonna be a long four years while Obomba’s DOJ lets massive corporate crime ride, and prosecutes…people for state-legalized marijuana offenses, whistle-blowers, and protesters.
(Masaccio has a great piece up about all this, too. Marcy’s information was just one notch deeper, so I decided to post it; it needs to get out abroad, imo.)
Yeah, well they’ve got the power and money (for now); they can buy Congress, the tax code, judges, Justices, but at least…we’ve got Boots to do some dreamin’ for us.