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This paper aims to provide an analysis of the HSBC Swiss bank accounts scandal, from the perspective of anti-money laundering (AML) compliance, and considers the future AML implications for the banking sector and HSBC. It reviews the use of a whistleblower to highlight AML irregularities rather than official reporting through the current AML compliance system.

The paper uses secondary data to offer a viewpoint on the HSBC issues from a money laundering and financial crime perspective. The paper extracts key statements from staff at HSBC and regulators and examines how AML risk assessment was undertaken at this time and what changes need to occur in the future. It considers the implications of the current theoretical context for AML from an agency theory perspective.

The main findings are that AML compliance needs to be embedded into a proactive corporate social responsibility approach rather than relying solely on regulation to improve detection and reporting of money laundering activity.

The research topic is new, and therefore, analysis papers and other academic writing on this topic are limited. Future research could consider the outcomes of the Swiss bank’s attempts to prosecute the whistleblower and whether this would have implications for future internal reporting and whistleblowing approaches to support AML compliance.

The implications from the research are the recommendations to the banking sector on addressing AML deficiencies especially within the context of an evolving level of criminal sophistication towards money laundering.

The paper supports the argument for integrating social corporate responsibility and AML compliance to produce a whole bank response to financial crime. This is in contrast to the current systems, which seem to be prevalent within the financial services, of profit and business being seen as separate rather than integral to regulation and control.

The originality of this paper is the current example of the HSBC Swiss case and the focus specifically on AML compliance rather than tax evasion, which has been the media angle on the issue.

This paper aims to apply the Legitimacy-Based View (LBV) of political risk to the experience of the Hongkong and Shanghai Banking Corporation (HSBC) in the First World War. The paper shows that HSBC’s ability to survive this conflict was due, in part, to its ability to manage political risk by maintaining legitimacy in the eyes of stakeholders in its home market(s), Hong Kong and the UK.

This case study is based on the surviving internal correspondence from this period in the HSBC Group archives in London and other primary sources.

This paper suggests that maintaining legitimacy in the home market is crucial to firm survival and profitability. Managers’ efforts to bolster firm legitimacy should ensure that individuals in all of the relevant government departments continue to regard the multinational enterprise (MNE) as legitimate.

This paper shows that the LBV is a potentially powerful analytical tool, but it also argues that the LBV must be modified so as to incorporate insights from the theoretical literature on ethnic and national identities, particularly the insight that such identities are culturally constructed and malleable.

Warfare tends to increase the degree to which a MNE’s stakeholders feel emotional bonds to their respective nations. HSBC’s experience in the First World War suggests that continued profitability in wartime may depend on the firm’s ability to shed its peacetime “world citizen” identity in favour of one that is more closely aligned with that of its home nation. Preserving political capital in wartime may require the ruthless termination of relationships with clients and employees who are associated with the enemy nation. Another lesson that MNE managers can derive from this paper is that preserving legitimacy in the home country may require the head office to exert more control over overseas managers, than would be the case in peace. A MNE in wartime that is concerned about the loss of legitimacy in the home country should consider adopting an organizational architecture that temporarily reduces subsidiary autonomy.

Buckley (2009) called for the re-integration of business history in International Business research. This paper is part of the ongoing historic turn in International Business and other management disciplines. This paper also argues that International Business scholars need to consider the impact of past wars on contemporary multinationals as we may witness the re-emergence of Great Power rivalries similar to those that led to the First World War. This paper proceeds on the assumption the probabilities of a war between two major capitalist economies are non-trivial and that additional investigation of the impact of major interstate warfare on MNEs is therefore merited. Historical research can help us to think about what a war between capitalist countries would mean for today’s MNEs.

HSBC (The Hong Kong and Shanghai Banking Corporation Limited) Holdings Plc. is a part of various trade finance consortia which aimed to digitise the traditional paper-based trade finance process. It had successfully executed multiple trade finance pilots using a blockchain based platform Voltron and was launching its Contour blockchain trade finance platform as a service to its clients. The trade finance market was estimated to be USD 18 trillion on an annual basis and HSBC had a 12% share in the trade finance transactions worldwide. This case revolves around the challenges facing banks/consortia while porting the traditional trade finance process to the blockchain based system. The crux is how the banks form the consortia, implement blockchain and facilitate trading globally given that it is a new technology and will require bringing all the stakeholders involved in the trade finance value chain to the blockchain based platform. HSBC is facing some decision questions on the formation, governance and management of the consortium, on the interoperability between consortia and on how to price its services to its customers.

This paper aims to highlight the relationship between money laundering and the patterns of behaviour evident throughout the larger structural environment of the Swiss banking sector. In particular, the paper used HSBC as a prototype case of structural ritualisation to show that the normalisation of corrupt, unethical behaviour in the banking environment has shaped and influenced the behaviour and actions of the embedded group actors.

The paper used a content analysis methodological approach of media sources to collect data. The content analysis was categorised into six core ritualised symbolic practices (RSP) categories – corruption, reputation, blame, ignorance, regret and criticism.

The findings reveal that the highly ranked RSPs involving corruption, reputation, blame, regret, ignorance and criticism influence the embedded group’s patterns of behaviour, and they formed part of the cognitive script that dictated their behaviour and actions in the Swiss banking sector.

The paper added to the calls by Swiss policymakers for amendments to Swiss bank secrecy laws to reflect the changing landscape of international banking and finance.

This is the first paper of its kind to study ritualised illegal practices related to money laundering in the Swiss banking sector.

This paper aims to provide a macro analysis of the USA’s anti-money laundering (AML) legislation. In examining the context and consequences of these regulations, a general determination can be made on the effectiveness of the current US AML legislation. The major AML regulations in the USA are covered under the Bank Secrecy Act, USA Patriot Act and the Office of Foreign Assets Control. It is difficult to determine what constitutes as implementation and maintenance of effective AML Compliance Programs because US federal AML requirements remain largely dynamic. This paper will provide some context to why certain major AML regulations were established as well as the reasoning behind their implementation. This paper will then attempt to determine the effectiveness of current AML regulations, particularly on the banking sector, by looking at several cases of alleged failure to maintain effective AML Compliance Programs. An examination will be conducted on HSBC’s $1.9 billion settlement in 2012 to the US government, as HSBC failed to establish a reasonable AML program according to the US Department of Justice press releases.

A brief description of major US AML regulations pertaining to the 2012 HSBC case is first made. Also, a look into the frequency of suspicious activity report (SAR) filings as well as initiated money laundering investigations is made. The paper critically analyzes the Financial Action Task Force (FATF)’s evaluation of US AML regulations.

It is evident that the FATF held an accurate evaluation of US AML regulations being both very comprehensive and severely enforced. The main criticism is with the implementation of these regulations driving adverse economic and social effects. Financial institutions fear being charged with not having a proper AML program; this causes banks to be more inclined to inflate SARs as well as engage in financial exclusion. It is difficult to prevent these adverse effects, as they directly result from having strict and comprehensive AML legislation, which is necessary to prevent and detect money being laundered.

A determination as to whether US AML regulations need strengthening or is too strict in that it causes adverse effects.

A macro analysis of America’s AML legislation is severely needed. Many papers on the issue lack a thorough description of the large-scale socio-economic effects of the AML programs of American financial institutions.

This paper aims to investigate the impact of the COVID-19 pandemic on the corporate governance practices in the UK. The authors adopt a case study approach and use content analysis, using internal and external media releases as well as annual reports to analyse the impact of the pandemic on governance practices.

The research design is qualitative in nature and adopts a case study approach. HSBC, an international bank, is used as the case study and a content analysis of internal and external information released after the COVID-19 outbreak is used. Themes arising from the analysis are discussed and recommendations are made.

Results from the thematic analysis show that firms must be resilient in difficult times, follow sustainable practices and are attentive to the well-being of their employees. Firms must address the adequacy of IT Infrastructure and assess the IT related risks during these times.

The pandemic crisis triggered unprecedented changes in the manner the firms are governed and managed. The recommendations made by the study have practical implications for firms who can adopt them to be make the business resilient and sustainable.

To the best of the authors’ knowledge, this is the first study to explore the impact of the pandemic and analyse firms’ responses to the crisis in the corporate governance context. This study contributes to the corporate governance literature by providing insights of the impact of the COVID-19 pandemic.

This paper aims to provide a brief overview of the anti-money laundering (AML) failings documented by the US Permanent Subcommittee on Investigations found in Hong Kong and Shanghai Banking Corporation (HSBC) Mexico. This paper focuses in on the key areas of concern raised by the 2012 report in respect of HSBC Mexico (HBMX) such as failure to undertake correct customer due diligence on high risk customers and repeated failings by senior management at HBMX to remedy these problems.

The relevant parts of the Subcommittee report relating to HBMX were examined along with the evidence submitted to the Subcommittee. From this examination, the author then noted the key examples of AML failings at HBMX and then commented on these examples while also referring to academic and regulatory guidance such as that from Financial Action Task Force.

Certain proposals are made throughout the paper, but these remain only suggestive. The key point is that the failings evident in HBMX may very well arise in other institutions, and this paper proposes how these failings may be resolved.

Research for this paper remained limited to second-source references such as the Subcommittee report and the listed Exhibits along with other academic resources. The paper was also peer reviewed by a compliance officer. However, examining the paper from a more practical viewpoint may have struck a better balance between an optimal and realistic level of compliance.

Adopting an analytic approach to the subject of AML controls should aid those who work in compliance daily while also generating further commentary among both regulators and senior management within financial institutions.

The paper is the only one to date to focus on one geographical strand of the AML failings at HSBC and then comment on this from an academic perspective.

This paper aims to highlight the shift of impunity from institutions to individuals within the “too big to fail, too big to jail” paradigm and to restore individual liability in the financial industry.

The paper is based on the analysis of HSBC deferred prosecution agreement concluded on December 10, 2012 and of a report by the US House of Representatives Financial Committee released in July 2016.

“Too big to fail, too big to jail” is a paradigm which contains justice. It leads to the impunity of individuals involved due to the absence of trial. Containment of justice is denial of justice. However, the systemic risk is attached to institutions, not to individuals. Therefore, it should not hamper the prosecution of individuals.

Setting sanctions applicable to individuals and proportionate to the crime would contribute to deter financial misconducts.

The value of the paper is the demonstration that there is no basis for a limited personal liability in the financial industry.

This study focuses on the impact of foreign direct investment (FDI) on local firms in host economies. We examine both backward and forward linkages and their effects on domestic firms. Data collection was undertaken over a three-year period whereby qualitative in-depth interviews were carried out with senior managers in UK headquarters, subsidiaries and ‘linked’ local firms in order to facilitate a multi-perspective approach to examining this topic. Results indicate that linkages do exist, contrary to earlier belief. The main factors which facilitate linkage formation were found to be subsidiary-related variables, mainly the mode of entry into the local market, subsidiary autonomy, level of embeddedness and subsidiary role. It was also found that government regulation and policy had some impact on the formation of linkages. Over time the impact on local firms was found to be positive with increased employment, productivity and significant upgrading of skills and competencies. The key contribution of this chapter is to extend the literature on linkages to consider services while developing a conceptual framework in this area. Overall, our study confirms the importance of the subsidiary in linkage formation and also shows how the externalities occurring from linkage formation in the service sector may benefit local firms and subsequently aid local economic development as a whole.

This paper aims to chart the origins and workings of two award‐winning schemes at HSBC – its work‐experience scheme and its apprenticeship program.

It details the reasons for the schemes, the form they take and the successes they have achieved.

This study explains that the work‐experience program takes the form of structured one‐week work experience for each of the bank's major business areas – retail, commercial, operational or head office. It is designed to offer an early opportunity for young people to find out more about the type of work the bank does and the career opportunities available. The HSBC apprenticeship program, meanwhile, offers the chance for people aged 16 upwards to get on to the career ladder, and gain new skills and professional qualifications while earning a salary.

The paper demonstrates to school pupils that they may not have to go to university in order to have a good career in a bank, and that they can still gain a professional qualification, following an apprenticeship.

It highlights two programs that are helping to make HSBC's workforce more diverse.

The paper discusses two programs that are seeking to open up banking careers to a wider section of the community.