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US DOJ, HSBC look to block release of money-laundering report


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US DOJ, HSBC look to block release of money-laundering report

Both HSBCHoldings Plc and the U.S. Department of Justice are looking toprevent a report being made public from an independent monitoring body aboutthe British bank program to improve its money-laundering controls, Reutersreported July 21.

In January, U.S. District Judge John Gleeson ruled that areport about HSBC's inconsistent attempts to correct its inadequatemoney-laundering controls should be disclosed to the public because of itsstatus as a "judicial record."

In its appeal against the earlier ruling filed July 21, theDOJ argued that "public disclosure of the monitor's report, even inredacted form, would hinder the monitor's ability to supervise HSBC" andwould also make bank staff less likely to cooperate with the improvementprogram, according to the newswire. A statement from the bank reportedly agreedthat "the effectiveness of the monitorship [was] dependent on confidentiality."

The independent monitor was installed within the bank aspart of its 2012deferred prosecution agreement for money-laundering violations.   

U.S. congressional investigators recently criticized seniorofficials at the DOJ for overruling internal recommendations and entering anagreement with the bank instead of criminally prosecuting it for theviolations, Reuters wrote.

The case is U.S. v. HSBC Bank USA NA et al, 2nd U.S. CircuitCourt of Appeals, No. 16-308.