Beijing, Sep 21 (efe-epa).- Shares of British banking giant HSBC, listed at the Hong Kong stock exchange, on Monday closed at their lowest level since 1995 after multiple media outlets published reports about an investigation that revealed that the bank allowed millions of dollars to be transferred in fraudulent transactions.
The bank’s share price closed at HK$ 29.3 ($3.78) on Monday, a 52 percent slump compared to the beginning of the year and 82 percent lower than its highest level reached in 2007, just before the global financial crisis.
The Hong Kong exchange witnessed HSBC shares lose 5.33 percent of their value within Monday.
The reasons behind the stock crash go beyond the recent reports and include the blacklisting of the company in China for having helped the United States in its investigations against Chinese tech giant Huawei, even though the bank backed the controversial national security law that Beijing imposed on Hong Kong. The law has been heavily criticized by Washington and London.
HSBC’s headquarters are situated in London and it is also listed at the stock exchange in the United Kingdom’s capital, but the bank was originally founded in Hong Kong in mid-19th century and a sizable part of its activity remains in Asia.
According to documents leaked to British public broadcaster BBC and news portal Buzzfeed, HSBC allegedly allowed funds of up to $80 million, generated by an investment fraud through its business in the US, to be transferred to Hong Kong-based accounts in 2013 and 2014, even after possessing evidence of the fraud.
The bank had claimed that it had fulfilled its legal obligations by reporting the activity.
The documents also show that the fraud, known as a Ponzi scheme, began shortly after the British bank was fined 1.4 billion pounds ($1.9 million) in the US for money laundering activities and had pledged to end this kind of practices.
The allegations against HSBC are part of the FinCEN files, a collection of more than 2,600 documents including 2,100 suspicious activity reports, which flag transactions that raise suspicion within the banks.
The banks send these reports to the pertinent authorities if they suspect their clients are involved in illicit activities, and are required to stop transactions if they have evidence of criminal practices.
The files, which were acquired by an international consortium of journalists, show how money was laundered through some of the world’s biggest banks and that criminals employed anonymous British companies to hide the wealth. EFE-EPA