HSBC Holdings has agreed to pay about US$100 million in penalties to resolve a US Justice Department investigation into the rigging of currency rates, part of a probe that has already led to the conviction of one of its former bankers and charges against another.
As part of the deal, HSBC entered into a deferred-prosecution agreement with prosecutors and promised to help with the criminal case against former traders and any other individuals swept up in the matter.
A DPA document, which must be approved by a judge, was filed in federal court in Brooklyn on Thursday. The three-year agreement requires the bank to cooperate with ongoing currency probes and “any other conduct under investigation” by the US.
The penalty comes a month after the London-based bank was released from a five-year deferred-prosecution agreement with the Justice Department for helping Mexican drug cartels launder money and breaching international sanctions by doing business with Iran.
HSBC released a statement saying that the conduct in the agreement occurred in 2010 and 2011 and that it has since introduced measures to strengthen its internal controls. “HSBC is committed to ensuring fair outcomes for its customers and protecting the orderly and transparent operation of the markets,” the bank said.
The US$100 million that HSBC agreed to pay is less than criminal penalties paid by other global banks almost three years ago for misconduct over the rigging of currency markets. In the 2015 resolutions, five banks pleaded guilty and each paid between US$200 million and US$925 million after admitting to colluding with each other to manipulate currency benchmarks.
The earlier cases were based on antitrust law over conduct affecting an entire market, whereas the HSBC matter was a fraud perpetuated on its own clients.