US: George Osborne ‘defended HSBC over money laundering’

Chancellor George Osborne rushed to defend HSBC against US prosecutors who wanted to charge it over money laundering in 2012, a House of Representatives’ report has revealed.

The report, entitled Too Big to Jail, revealed top US Department of Justice officials accepted advice that a guilty plea for HSBC could put it out of business and cause severe turmoil in the financial system.

Instead they went for a £1.2 billion payment as part of a deferred settlement.

The report states: “Osborne insinuated in his letter... that the US was unfairly targeting UK banks by seeking settlements that were significantly higher than comparable settlements with US banks.”

It also said that the then regulator, the Financial Services Authority, “appears to have hampered the US government’s investigations and influenced the DoJ’s decision not to prosecute HSBC”.

The 2012 settlement with HSBC detailed how the bank violated US sanctions by conducting business for customers in Iran, Libya, Sudan, Burma and Cuba.

It also said the bank’s accounts were used by drug cartels in Mexico and Colombia. HSBC declined to comment.