In the latest issue of Rolling Stone, Matt Taibbi takes the Justice Department to task over settling with HSBC late last year in the "largest drug-and-terrorism money-laundering case ever."
"The HSBC case went miles beyond the usual paper-pushing, keypad-punching sort-of crime, committed by geeks in ties, normally associatedwith Wall Street," he writes, "In this case, the bank literally got away with murder – well, aiding and abetting it, anyway."
The lengthy post details how the bank again and again flouted cease-and-desist orders from the Office of the Comptroller of the Currency to cut ties with Islamist militant groups and drug trafficking operations in Mexico. For years, the OCC did not more than the "take deep breath, strap on its big-boy pants and . . . issue a second cease-and-desist order!"
Taibbi notes why the eventual criminal investigation ended with a fine (of "$1.9 billion, or about five weeks' profit") and not any jail time or fines for individuals involved:
What is different about this settlement is that the Justice Department, for the first time, admitted why it decided to go soft on this particular kind of criminal. It was worried that anything more than a wrist slap for HSBC might undermine the world economy. "Had the U.S. authorities decided to press criminal charges," said Assistant Attorney General Lanny Breuer at a press conference to announce the settlement, "HSBC would almost certainly have lost its banking license in the U.S., the future of the institution would have been under threat and the entire banking system would have been destabilized."
During a Democracy Now! appearance Thursday, Taibbi said, “What HSBC has now admitted to is more or less the worst behavior that any bank can possibly be guilty of.”