LONDON – The City of London police are investigating an alleged attempted £70 million fraud at HSBC, the UK’s largest bank. Focus is centring on the bank’s securities services division, but an HSBC spokesperson was keen to stress that no customer funds were involved, no transactions were disrupted and no customer or bank funds were lost.
Few details have been made public but it is known that HSBC alerted police on April 25 after the alleged attempted fraud was detected in the trade settlement area of its securities services division. The motive appears to have involved moving money electronically from one account into another.
A back-office worker, a 25-year-old man from Ilford in Essex, has been charged with conspiracy to defraud, money laundering and abuse of a position of trust. He has been remanded in custody until June 25, when he will appear at Southwark Crown Court.
Three other men have also been bailed in connection with the investigation.
This incident will only serve to dent consumer confidence further, coming just four months after French bank Societe Generale uncovered an alleged multi-billion-euro fraud by Jerome Kerviel. It will also serve to remind other banks of the importance of the robustness and security of their internal systems and controls, as well as highlighting the need for compliance officers to be extra vigilant during this time of market turmoil for disgruntled workers seeking to profit from the disarray.