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Isn't Credit Suisse the bank that laundered and legitimized all the money from the drug cartels? They kept getting slaps on the wrist for a bunch of atrocities

Isn't Credit Suisse the bank that laundered and legitimized all the money from the drug cartels? They kept getting slaps on the wrist for a bunch of atrocities and bad choices and now finally they are seeing some repercussions of those choices?

mtlmtlmtlmtl 4y ago
Yep. I went and quickly looked them up on Wikipedia. They have a list of controversies so long that the outline of the "controversies" subheading won't even fit on my phone screen. Drug cartel money, strong ties to the Russian oligarchy, forex manipulation, corrupt dealings with African governments, destruction of records, tax fraud. The list is extensive to say the least.
- thefounder 4y ago
  >> Drug cartel money, strong ties to the Russian oligarchy, forex manipulation, corrupt dealings with African governments, destruction of records, tax fraud. Sounds like HSBC
  - odiroot 4y ago
    And Deutsche Bank.
  - samstave 4y ago
    Precisely why HSBC bought UK SVB They need to protect their laundering clients. HSBC is an extension of the UK laundering fraud arm of Yee Olde Kingdom. Expect much fuckery afoot.
    - mtlmtlmtlmtl 4y ago
      If anyone is interested in digging into this more, read up on the City of London. Not to be confused with London, the capital of England, the City of London is effectively a weird de facto tax haven city-state embedded in London. Edit: Somehow managed to write "nationstate" instead of "city-state"
- curiousgal 4y ago
  I am more than 100% confident that those controversies have nothing to do with the current mess. CS is failing not because it laundered cartel money, it is failing because it didn't manage risks properly, namely Archegos and Greensill. You guys make it sound like the universes punishes those who do bad things which is laughable.
  - timmytokyo 4y ago
    It's not exactly surprising that a company known for its extensive dealings with corrupt actors is also bad at managing risk.
    - mtlmtlmtlmtl 4y ago
      Yeah this makes sense. One of the cases where A causes both B and C. People willing to take part in criminal activities are almost definitionally less risk averse. You're risking fines, loss of reputation, prison, unemployability, destitution. Not then surprising that those same people would be more willing to take undue financial risk, all the while maybe closing an eye to some red flags.
    - riffraff 4y ago
      > It's not exactly surprising that a company known for its extensive dealings with corrupt actors is also bad at managing risk. HSBC is just as evil, and is doing well enough that they just acquired the UK branch of SVB https://www.icij.org/investigations/fincen-files/hsbc-moved-vast-sums-of-dirty-money-after-paying-record-laundering-fine/ https://www.icij.org/investigations/fincen-files/hsbc-moved-...
      - HorizonXP 4y ago
        FTX bought Voyager when they went down. Acquisitions != health
        IG_Semmelweiss 4y ago
        Its well known that acquisitions are a great way to hide fraud, too. Number of studies on that front. Another (usual) reason is when a company lacks clear avenues for growth so they are looking to buy some growtg
- saiya-jin 4y ago
  As you write, you have no real clue about banking. Let me tell you, all that you wrote, and more, much more, can be said about every single big bank out there, anywhere. How do I know this - I work for one of those, not (and never) CS. Since I started ours is rather spot clean from what I can see (but IT is very far from those who make similar decisions), what I see is regulatory downfall from their fuckups 15-30 years ago. Some of it was outright amoral criminal behavior, but most was due to bad processes and way too much incompetence in ie KYC checks. Too much focus on current cash flow, way too few questions about where the money came from. That's thing of the past in regulated markets (but then you have the whole universe of tax havens, some also in US or conveniently around)
  - mtlmtlmtlmtl 4y ago
    Thanks for the inside perspective, very helpful. There's no doubt that corruption in banking was a complete free for all in the past during times of intense financial deregulation, and that regulated markets have improved their vigilance markedly since then. It makes sense that for banks such as yours, there might be a sort of echo of the past in scandals being outed presently. And a lot of those cases are more wilful ignorance and poor due diligence as you say Of course CS is in a tax haven, and their dirty laundry generally seems much fresher and much more deliberate than negligent. E.g attempting to help cover up assets of Russian oligarchs under sanctions after the Russian invasion of Ukraine. And the Credit Suisse leaks last year revealed just how much dirty money flows through the bank still to this day.
- simplotek 4y ago
  > The list is extensive to say the least. Sometimes I wonder if the Swiss newfound love for a weirdly biased neutrality, which goes to the extent of destroying their own military gear instead of selling it to Ukraine, is rooted in appeasing certain Russians who stashed their fortunes in financial institutions such as Credit Suisse.
  - Swenrekcah 4y ago
    > destroying their own military gear instead of selling it to Ukraine What?
    - mocko 4y ago
      That sounded so nuts I had to look it up. Turns out they really are! https://www.lemonde.fr/en/international/article/2023/03/13/switzerland-to-destroy-anti-aircraft-missile-systems-that-could-be-used-in-ukraine_6019124_4.html https://www.lemonde.fr/en/international/article/2023/03/13/s...
      - mtlmtlmtlmtl 4y ago
        Truly a perplexing country. It's kind of easy to be neutral when you're landlocked inside NATO, I guess. No reason to even join. Neutrality didn't quite work out that way for Norway in WW2... Great cheese down there though, gotta give them that.
        TechBro8615 4y ago
        > It's kind of easy to be neutral when you're landlocked inside NATO I guess you think that NATO is why the Swiss people added a neutrality clause to the constitution of the Swiss Confederation during the Restoration in 1815?
        mtlmtlmtlmtl 4y ago
        Only in the bizarro world where I make laughably false statements so you can point it out to feel clever. No, the NATO part is only commenting on current events. The reason they weren't invaded during WW2 was mainly that they had a strong military in a very mountainous country with next to no strategic or material importance to Hitler. Just not worth the trouble. If Hitler saw a strategic reason to invade Switzerland he would have; he had no reservations about ignoring neutrality. I figured all this was obvious given knowledge about basic history and geography, and that it didn't need to be spelled out that I know NATO didn't exist during or before WW2
- moffkalast 4y ago
  People have been calling them "Credit Sus" which I think is quite warranted.
  - gonzo41 4y ago
    The best quip I saw was some saying they'd changed their name from Credit Suisse to Debit Suisse.
    - mtlmtlmtlmtl 4y ago
      That is one wicked burn rate.
    - popcalc 4y ago
      https://shop.litquidity.co/products/mug-debit-suisse https://shop.litquidity.co/products/mug-debit-suisse My type of impulse buy
      - gonzo41 4y ago
        That's awesome merch. Kudos to that person.
- rXoX 4y ago
  [dead]
- fnord77 4y ago
  nobody does corruption like the swiss (IOC, FIFA, etc)
- abc03 4y ago
  Mmh, are you also describing the American goverment? Remember drug for guns?
samstave 4y ago
[flagged]
- WelcomeShorty 4y ago
  Except proton I guess?
  - mantas 4y ago
    Proton is Swiss only in shell company registration. Development and management is not Swiss.
  - bragr 4y ago
    Not to pile on the the crazy person's thread, but it would not be unprecedented if Proton is actually a honeypot controlled by foreign intelligence agencies and would not be the first such Swiss company: https://en.wikipedia.org/wiki/Crypto_AG https://en.wikipedia.org/wiki/Crypto_AG
  - 8o8o8o8o8 4y ago
    [flagged]
    - FormerBandmate 4y ago
      No, it isn’t. A vendor that provided DDOS protection used to be but no longer is
- gmiller123456 4y ago
  What about the knives for their army? Certainly the fingernail file isn't corrupt?
mike_hearn 4y ago
You might also be thinking of HSBC [1] or Wachovia [2] or possibly one of several Australian banks [3] or maybe this European bank [4] or this one [5], or indeed Credit Suisse. The thing to know about money laundering is that the rules are basically set by the USA, and after the 9/11 attacks the US made money laundering a strict liability crime. It means you can be found guilty of it even if you didn't know you were doing it, made extensive efforts to ensure you didn't and even if the actual violations were made by someone else not yourself. And money laundering is defined as moving money on the behalf of criminals, or not doing enough to realize you were doing so. How much is doing enough? That's subjective, up to the regulators and they are allowed to do things like tell you you're doing enough then later change their mind and prosecute you for it. Because it's impossible to successfully comply with such a moving target, every large bank in the world is constantly being fined for AML violations. It doesn't mean much about any specific bank to say it's been fined for that. If it was possible to actually comply, there'd be no crime that involved any financial component any more i.e. no drug trade or fraud, because the banks would always detect it, suspend the accounts, report the owners and seize the money. Clearly these crimes do still exist because banks don't have enough information to reliably beat all criminals. They don't have police powers, so the most they can do is rely on heuristics. It's especially tough in parts of the world where cartels may have unlimited budgets to beat your systems, corrupt your employees, corrupt government employees or threaten your staff with having their arms chopped off if they don't help out. AML regulations don't recognize these problems as legitimate however, meaning you as a banker can be prosecuted and jailed for up to 20 years because someone, somewhere else in your organization, wasn't suspicious enough about some activity and report it in a timely manner. That's why it feels like banks are always "getting away with it". Governments, even the US government, can't actually enforce the laws as written because if they did then the entire financial industry would collapse overnight from mass staff exodus. This was the very real risk that led to HSBC being fined rather than directly prosecuting the staff. There was apparently a big fight inside the US Gov about this between the Justice Dept and the Treasury, with (I think) the former wanting prosecutions and the latter pushing for no prosecutions. The Treasury knew that prosecutions could succeed and if they did, there'd be a very different and much worse kind of bank run. To me, it doesn't seem reasonable to expect bankers to achieve what the world's police forces and intelligence agencies never could. But the public doesn't really understand these dynamics. Whenever they read about banks laundering money, they think it's bankers who are knowingly taking part in organized crime and so demand punitive action. Governments can then blame the banks for crime whilst simultaneously taking some billions of dollars from them for the general budget. In the short term it's a win for them. The true cost is somewhat subtle and long term, in things like innocent people being unable to get bank accounts, or finding it very difficult, and a general feeling of society being rigged in favor of the bankers who never seem to be punished for their claimed crimes. The fix would be a mix of changes to AML rules and the PATRIOT Act, transforming the system into something a lot more mechanical and objective. It might make some crime a bit easier, but that can be counterbalanced by e.g. increased funding to the police. [1] https://www.learnsignal.com/blog/hsbc-money-laundering/#:~:text=Evidence%20emerged%20that%20HSBC%20had,such%20as%20Iran%20and%20Sudan https://www.learnsignal.com/blog/hsbc-money-laundering/#:~:t.... [2] https://www.theguardian.com/world/2011/apr/03/us-bank-mexico-drug-gangs https://www.theguardian.com/world/2011/apr/03/us-bank-mexico... [3] https://www.vice.com/en/article/g5bkyq/drug-cartels-used-australian-banks-to-launder-money https://www.vice.com/en/article/g5bkyq/drug-cartels-used-aus... [4] https://money.cnn.com/2018/02/08/news/rabobank-mexico-drug-money-laundering/index.html https://money.cnn.com/2018/02/08/news/rabobank-mexico-drug-m... [5] https://www.newyorker.com/news/news-desk/the-fincen-files-shed-new-light-on-a-scandalous-episode-at-deutsche-bank https://www.newyorker.com/news/news-desk/the-fincen-files-sh...
throwntoday 4y ago
Not stating an opinion but isn't that more of an issue with countries that choose to do business with Switzerland? Swiss banking privacy and their grey/black practices are sovereign decisions they have every right to make but it appears that countries are willing to turn a blind eye to it. We could wax on about morality but the real issue here is it's tolerated by the rest of the world so they have little pressure to change.
- mike_hearn 4y ago
  Switzerland doesn't have any unusual banking privacy laws anymore, those were abolished a long time ago. The US imposes crippling sanctions on any country that doesn't implement the same financial crime / tax information laws as themselves, so Switzerland came into compliance with US policy on that.
rvz 4y ago
Yes. [0] [1] Alongside all the other banks that allowed trillions of dollars worth of illicit and laundered funds to criminals, drug cartels, etc. Unquestioned. Seems like the crime on the banking networks pays more than the fines, since both the banks and the regulators get a profit either way helping process transactions from criminals. [0] https://www.buzzfeednews.com/article/jasonleopold/fincen-files-financial-scandal-criminal-networks https://www.buzzfeednews.com/article/jasonleopold/fincen-fil... [1] https://www.nytimes.com/2020/09/20/business/fincen-banks-suspicious-activity-reports-buzzfeed.html https://www.nytimes.com/2020/09/20/business/fincen-banks-sus...
_trampeltier 4y ago
I think lately it was more HSBC who laundered money for cartels.
01100011 4y ago
Yeah. they're right up there with JP Morgan Chase and Deutsche Bank: https://www.thestreet.com/investing/jpmorgan-jpm-deutsche-bank-db-money-laundering-report https://www.thestreet.com/investing/jpmorgan-jpm-deutsche-ba...
thom 4y ago
Well yes, but so did HSBC, Barclays and presumably all the other banks. So, reasons to be cheerful.
ummonk 4y ago
If anything it’s the opposite issue that could be the nail in the coffin - wealthy Chinese are pulling their money out after Switzerland decided to adopt sanctions against Russians.
briantakita 4y ago
The entire financial system is built on fraudulent activity. HSBC started by laundering money for opium drug dealers into China, regular scandals, revolving door regulators, etc. The biggest surprise is how the system has not collapsed yet. It would not surprise me if the can is kicked further down the road after some people get a hair cut. It would also not surprise me if the multi polar world goes back to commodity backed currencies...e.g. gold & oil.
omgomgomgomg 4y ago
Former banker here, familiar with Swiss practices. They have done so much more bad things, things not mentioned in this thread. And after the US intervened, they carried on with the same, just even more sophisticated. How Swiss banking has a good name should be beyond anyone. Assume it is all careful, decade long marketing and PR stuff. I in details know about some internal things regarding employee conduct which is Holywood material worthy.
- throwawaylinux 4y ago
  Did the US intervene because the Swiss were taking much of the cartel laundering market away from their institutions? Banks don't have a good name, it's not just the Swiss. I mean they have a good name among the corrupt and the rich who love their help laundering money, skirting laws, and socializing their losses. Among the common person, regard for banks probably sits somewhere between politician and lawyer.
  - omgomgomgomg 4y ago
    Do not worry about the Swiss, they know to launder money even without american clientele. They have many buddies in Liechtenstein with odd funds, charities never yet seen in the so called leaks. The historic reasons for the us taking a at the swiss have been the hidden, non declared tax moneys from american people and corporations. The Swiss had a cloaking system in place called banking secrecy, it was even codified into law. America wanted whats owed to them and that was it. Swiss bankers would fly to the us physically, in person, pick up funds and goods like diamonds and transport them to switzerland without declaring anything. All the little tricks like labelling the funds fraudulently, diamonds in a toothpaste tube, that was part of the service portfolio. The us promised to sue and the whole decisionmakers knew they will be safe nowehere but in switzerland, a small country with sub par weather, and if the us got hold of them, they will spend a good time of their lifes behind bars. The swiss banking secrecy laws were thus burried for good. The swiss still had the cheek to blather about data protection and privacy and then agreed to hand over a portfolio of "suspicious" accounts. How hypocritical this was was shown later on, when it became impossible in switzerland and europe for americans to open bank accounts unless employed in Switzerland and being residents. You say banks have a bad reputation overall, but somehow the swiss banks had a better reputation, even though they are on a level with a carribean tax haven operator.
throwawaylinux 4y ago
I thought that was HSBC. Turns out it's both. Probably all of them.
MichaelMoser123 4y ago
https://news.ycombinator.com/item?id=35166892#35176836 https://news.ycombinator.com/item?id=35166892#35176836 my comment here on switzerland during the second world war. these are really more than a bunch of atrocities, if you ask me.
SyzygistSix 4y ago
That was also Wells Fargo.
dragonwriter 4y ago
> Isn't Credit Suisse the bank that laundered and legitimized all the money from the drug cartels? No. I mean, some, sure, but “all”? Nah, Wachovia [0], HSBC [1], and, well, pick a major bank, really... [0] https://www.theguardian.com/world/2011/apr/03/us-bank-mexico-drug-gangs https://www.theguardian.com/world/2011/apr/03/us-bank-mexico... [1] https://www.investopedia.com/stock-analysis/2013/investing-news-for-jan-29-hsbcs-money-laundering-scandal-hbc-scbff-ing-cs-rbs0129.aspx https://www.investopedia.com/stock-analysis/2013/investing-n...

mtlmtlmtlmtl 4y ago

Yep. I went and quickly looked them up on Wikipedia. They have a list of controversies so long that the outline of the "controversies" subheading won't even fit on my phone screen. Drug cartel money, strong ties to the Russian oligarchy, forex manipulation, corrupt dealings with African governments, destruction of records, tax fraud. The list is extensive to say the least.

thefounder 4y ago
>> Drug cartel money, strong ties to the Russian oligarchy, forex manipulation, corrupt dealings with African governments, destruction of records, tax fraud. Sounds like HSBC
- odiroot 4y ago
  And Deutsche Bank.
- samstave 4y ago
  Precisely why HSBC bought UK SVB They need to protect their laundering clients. HSBC is an extension of the UK laundering fraud arm of Yee Olde Kingdom. Expect much fuckery afoot.
  - mtlmtlmtlmtl 4y ago
    If anyone is interested in digging into this more, read up on the City of London. Not to be confused with London, the capital of England, the City of London is effectively a weird de facto tax haven city-state embedded in London. Edit: Somehow managed to write "nationstate" instead of "city-state"
curiousgal 4y ago
I am more than 100% confident that those controversies have nothing to do with the current mess. CS is failing not because it laundered cartel money, it is failing because it didn't manage risks properly, namely Archegos and Greensill. You guys make it sound like the universes punishes those who do bad things which is laughable.
- timmytokyo 4y ago
  It's not exactly surprising that a company known for its extensive dealings with corrupt actors is also bad at managing risk.
  - mtlmtlmtlmtl 4y ago
    Yeah this makes sense. One of the cases where A causes both B and C. People willing to take part in criminal activities are almost definitionally less risk averse. You're risking fines, loss of reputation, prison, unemployability, destitution. Not then surprising that those same people would be more willing to take undue financial risk, all the while maybe closing an eye to some red flags.
  - riffraff 4y ago
    > It's not exactly surprising that a company known for its extensive dealings with corrupt actors is also bad at managing risk. HSBC is just as evil, and is doing well enough that they just acquired the UK branch of SVB https://www.icij.org/investigations/fincen-files/hsbc-moved-vast-sums-of-dirty-money-after-paying-record-laundering-fine/ https://www.icij.org/investigations/fincen-files/hsbc-moved-...
    - HorizonXP 4y ago
      FTX bought Voyager when they went down. Acquisitions != health
      - IG_Semmelweiss 4y ago
        Its well known that acquisitions are a great way to hide fraud, too. Number of studies on that front. Another (usual) reason is when a company lacks clear avenues for growth so they are looking to buy some growtg
saiya-jin 4y ago
As you write, you have no real clue about banking. Let me tell you, all that you wrote, and more, much more, can be said about every single big bank out there, anywhere. How do I know this - I work for one of those, not (and never) CS. Since I started ours is rather spot clean from what I can see (but IT is very far from those who make similar decisions), what I see is regulatory downfall from their fuckups 15-30 years ago. Some of it was outright amoral criminal behavior, but most was due to bad processes and way too much incompetence in ie KYC checks. Too much focus on current cash flow, way too few questions about where the money came from. That's thing of the past in regulated markets (but then you have the whole universe of tax havens, some also in US or conveniently around)
- mtlmtlmtlmtl 4y ago
  Thanks for the inside perspective, very helpful. There's no doubt that corruption in banking was a complete free for all in the past during times of intense financial deregulation, and that regulated markets have improved their vigilance markedly since then. It makes sense that for banks such as yours, there might be a sort of echo of the past in scandals being outed presently. And a lot of those cases are more wilful ignorance and poor due diligence as you say Of course CS is in a tax haven, and their dirty laundry generally seems much fresher and much more deliberate than negligent. E.g attempting to help cover up assets of Russian oligarchs under sanctions after the Russian invasion of Ukraine. And the Credit Suisse leaks last year revealed just how much dirty money flows through the bank still to this day.
simplotek 4y ago
> The list is extensive to say the least. Sometimes I wonder if the Swiss newfound love for a weirdly biased neutrality, which goes to the extent of destroying their own military gear instead of selling it to Ukraine, is rooted in appeasing certain Russians who stashed their fortunes in financial institutions such as Credit Suisse.
- Swenrekcah 4y ago
  > destroying their own military gear instead of selling it to Ukraine What?
  - mocko 4y ago
    That sounded so nuts I had to look it up. Turns out they really are! https://www.lemonde.fr/en/international/article/2023/03/13/switzerland-to-destroy-anti-aircraft-missile-systems-that-could-be-used-in-ukraine_6019124_4.html https://www.lemonde.fr/en/international/article/2023/03/13/s...
    - mtlmtlmtlmtl 4y ago
      Truly a perplexing country. It's kind of easy to be neutral when you're landlocked inside NATO, I guess. No reason to even join. Neutrality didn't quite work out that way for Norway in WW2... Great cheese down there though, gotta give them that.
      - TechBro8615 4y ago
        > It's kind of easy to be neutral when you're landlocked inside NATO I guess you think that NATO is why the Swiss people added a neutrality clause to the constitution of the Swiss Confederation during the Restoration in 1815?
        mtlmtlmtlmtl 4y ago
        Only in the bizarro world where I make laughably false statements so you can point it out to feel clever. No, the NATO part is only commenting on current events. The reason they weren't invaded during WW2 was mainly that they had a strong military in a very mountainous country with next to no strategic or material importance to Hitler. Just not worth the trouble. If Hitler saw a strategic reason to invade Switzerland he would have; he had no reservations about ignoring neutrality. I figured all this was obvious given knowledge about basic history and geography, and that it didn't need to be spelled out that I know NATO didn't exist during or before WW2
moffkalast 4y ago
People have been calling them "Credit Sus" which I think is quite warranted.
- gonzo41 4y ago
  The best quip I saw was some saying they'd changed their name from Credit Suisse to Debit Suisse.
  - mtlmtlmtlmtl 4y ago
    That is one wicked burn rate.
  - popcalc 4y ago
    https://shop.litquidity.co/products/mug-debit-suisse https://shop.litquidity.co/products/mug-debit-suisse My type of impulse buy
    - gonzo41 4y ago
      That's awesome merch. Kudos to that person.
rXoX 4y ago
[dead]
fnord77 4y ago
nobody does corruption like the swiss (IOC, FIFA, etc)
abc03 4y ago
Mmh, are you also describing the American goverment? Remember drug for guns?

samstave 4y ago

[flagged]

WelcomeShorty 4y ago
Except proton I guess?
- mantas 4y ago
  Proton is Swiss only in shell company registration. Development and management is not Swiss.
- bragr 4y ago
  Not to pile on the the crazy person's thread, but it would not be unprecedented if Proton is actually a honeypot controlled by foreign intelligence agencies and would not be the first such Swiss company: https://en.wikipedia.org/wiki/Crypto_AG https://en.wikipedia.org/wiki/Crypto_AG
- 8o8o8o8o8 4y ago
  [flagged]
  - FormerBandmate 4y ago
    No, it isn’t. A vendor that provided DDOS protection used to be but no longer is
gmiller123456 4y ago
What about the knives for their army? Certainly the fingernail file isn't corrupt?

mike_hearn 4y ago

You might also be thinking of HSBC [1] or Wachovia [2] or possibly one of several Australian banks [3] or maybe this European bank [4] or this one [5], or indeed Credit Suisse. The thing to know about money laundering is that the rules are basically set by the USA, and after the 9/11 attacks the US made money laundering a strict liability crime. It means you can be found guilty of it even if you didn't know you were doing it, made extensive efforts to ensure you didn't and even if the actual violations were made by someone else not yourself. And money laundering is defined as moving money on the behalf of criminals, or not doing enough to realize you were doing so. How much is doing enough? That's subjective, up to the regulators and they are allowed to do things like tell you you're doing enough then later change their mind and prosecute you for it. Because it's impossible to successfully comply with such a moving target, every large bank in the world is constantly being fined for AML violations. It doesn't mean much about any specific bank to say it's been fined for that. If it was possible to actually comply, there'd be no crime that involved any financial component any more i.e. no drug trade or fraud, because the banks would always detect it, suspend the accounts, report the owners and seize the money. Clearly these crimes do still exist because banks don't have enough information to reliably beat all criminals. They don't have police powers, so the most they can do is rely on heuristics. It's especially tough in parts of the world where cartels may have unlimited budgets to beat your systems, corrupt your employees, corrupt government employees or threaten your staff with having their arms chopped off if they don't help out. AML regulations don't recognize these problems as legitimate however, meaning you as a banker can be prosecuted and jailed for up to 20 years because someone, somewhere else in your organization, wasn't suspicious enough about some activity and report it in a timely manner. That's why it feels like banks are always "getting away with it". Governments, even the US government, can't actually enforce the laws as written because if they did then the entire financial industry would collapse overnight from mass staff exodus. This was the very real risk that led to HSBC being fined rather than directly prosecuting the staff. There was apparently a big fight inside the US Gov about this between the Justice Dept and the Treasury, with (I think) the former wanting prosecutions and the latter pushing for no prosecutions. The Treasury knew that prosecutions could succeed and if they did, there'd be a very different and much worse kind of bank run. To me, it doesn't seem reasonable to expect bankers to achieve what the world's police forces and intelligence agencies never could. But the public doesn't really understand these dynamics. Whenever they read about banks laundering money, they think it's bankers who are knowingly taking part in organized crime and so demand punitive action. Governments can then blame the banks for crime whilst simultaneously taking some billions of dollars from them for the general budget. In the short term it's a win for them. The true cost is somewhat subtle and long term, in things like innocent people being unable to get bank accounts, or finding it very difficult, and a general feeling of society being rigged in favor of the bankers who never seem to be punished for their claimed crimes. The fix would be a mix of changes to AML rules and the PATRIOT Act, transforming the system into something a lot more mechanical and objective. It might make some crime a bit easier, but that can be counterbalanced by e.g. increased funding to the police. [1] https://www.learnsignal.com/blog/hsbc-money-laundering/#:~:text=Evidence%20emerged%20that%20HSBC%20had,such%20as%20Iran%20and%20Sudan https://www.learnsignal.com/blog/hsbc-money-laundering/#:~:t.... [2] https://www.theguardian.com/world/2011/apr/03/us-bank-mexico-drug-gangs https://www.theguardian.com/world/2011/apr/03/us-bank-mexico... [3] https://www.vice.com/en/article/g5bkyq/drug-cartels-used-australian-banks-to-launder-money https://www.vice.com/en/article/g5bkyq/drug-cartels-used-aus... [4] https://money.cnn.com/2018/02/08/news/rabobank-mexico-drug-money-laundering/index.html https://money.cnn.com/2018/02/08/news/rabobank-mexico-drug-m... [5] https://www.newyorker.com/news/news-desk/the-fincen-files-shed-new-light-on-a-scandalous-episode-at-deutsche-bank https://www.newyorker.com/news/news-desk/the-fincen-files-sh...

throwntoday 4y ago

Not stating an opinion but isn't that more of an issue with countries that choose to do business with Switzerland? Swiss banking privacy and their grey/black practices are sovereign decisions they have every right to make but it appears that countries are willing to turn a blind eye to it. We could wax on about morality but the real issue here is it's tolerated by the rest of the world so they have little pressure to change.

mike_hearn 4y ago
Switzerland doesn't have any unusual banking privacy laws anymore, those were abolished a long time ago. The US imposes crippling sanctions on any country that doesn't implement the same financial crime / tax information laws as themselves, so Switzerland came into compliance with US policy on that.

rvz 4y ago

Yes. [0] [1] Alongside all the other banks that allowed trillions of dollars worth of illicit and laundered funds to criminals, drug cartels, etc. Unquestioned. Seems like the crime on the banking networks pays more than the fines, since both the banks and the regulators get a profit either way helping process transactions from criminals. [0] https://www.buzzfeednews.com/article/jasonleopold/fincen-files-financial-scandal-criminal-networks https://www.buzzfeednews.com/article/jasonleopold/fincen-fil... [1] https://www.nytimes.com/2020/09/20/business/fincen-banks-suspicious-activity-reports-buzzfeed.html https://www.nytimes.com/2020/09/20/business/fincen-banks-sus...

_trampeltier 4y ago

I think lately it was more HSBC who laundered money for cartels.

01100011 4y ago

Yeah. they're right up there with JP Morgan Chase and Deutsche Bank: https://www.thestreet.com/investing/jpmorgan-jpm-deutsche-bank-db-money-laundering-report https://www.thestreet.com/investing/jpmorgan-jpm-deutsche-ba...

thom 4y ago

Well yes, but so did HSBC, Barclays and presumably all the other banks. So, reasons to be cheerful.

ummonk 4y ago

If anything it’s the opposite issue that could be the nail in the coffin - wealthy Chinese are pulling their money out after Switzerland decided to adopt sanctions against Russians.

briantakita 4y ago

The entire financial system is built on fraudulent activity. HSBC started by laundering money for opium drug dealers into China, regular scandals, revolving door regulators, etc. The biggest surprise is how the system has not collapsed yet. It would not surprise me if the can is kicked further down the road after some people get a hair cut. It would also not surprise me if the multi polar world goes back to commodity backed currencies...e.g. gold & oil.

omgomgomgomg 4y ago

Former banker here, familiar with Swiss practices. They have done so much more bad things, things not mentioned in this thread. And after the US intervened, they carried on with the same, just even more sophisticated. How Swiss banking has a good name should be beyond anyone. Assume it is all careful, decade long marketing and PR stuff. I in details know about some internal things regarding employee conduct which is Holywood material worthy.

throwawaylinux 4y ago
Did the US intervene because the Swiss were taking much of the cartel laundering market away from their institutions? Banks don't have a good name, it's not just the Swiss. I mean they have a good name among the corrupt and the rich who love their help laundering money, skirting laws, and socializing their losses. Among the common person, regard for banks probably sits somewhere between politician and lawyer.
- omgomgomgomg 4y ago
  Do not worry about the Swiss, they know to launder money even without american clientele. They have many buddies in Liechtenstein with odd funds, charities never yet seen in the so called leaks. The historic reasons for the us taking a at the swiss have been the hidden, non declared tax moneys from american people and corporations. The Swiss had a cloaking system in place called banking secrecy, it was even codified into law. America wanted whats owed to them and that was it. Swiss bankers would fly to the us physically, in person, pick up funds and goods like diamonds and transport them to switzerland without declaring anything. All the little tricks like labelling the funds fraudulently, diamonds in a toothpaste tube, that was part of the service portfolio. The us promised to sue and the whole decisionmakers knew they will be safe nowehere but in switzerland, a small country with sub par weather, and if the us got hold of them, they will spend a good time of their lifes behind bars. The swiss banking secrecy laws were thus burried for good. The swiss still had the cheek to blather about data protection and privacy and then agreed to hand over a portfolio of "suspicious" accounts. How hypocritical this was was shown later on, when it became impossible in switzerland and europe for americans to open bank accounts unless employed in Switzerland and being residents. You say banks have a bad reputation overall, but somehow the swiss banks had a better reputation, even though they are on a level with a carribean tax haven operator.

throwawaylinux 4y ago

I thought that was HSBC. Turns out it's both. Probably all of them.

MichaelMoser123 4y ago

https://news.ycombinator.com/item?id=35166892#35176836 https://news.ycombinator.com/item?id=35166892#35176836 my comment here on switzerland during the second world war. these are really more than a bunch of atrocities, if you ask me.

SyzygistSix 4y ago

That was also Wells Fargo.

dragonwriter 4y ago

> Isn't Credit Suisse the bank that laundered and legitimized all the money from the drug cartels? No. I mean, some, sure, but “all”? Nah, Wachovia [0], HSBC [1], and, well, pick a major bank, really... [0] https://www.theguardian.com/world/2011/apr/03/us-bank-mexico-drug-gangs https://www.theguardian.com/world/2011/apr/03/us-bank-mexico... [1] https://www.investopedia.com/stock-analysis/2013/investing-news-for-jan-29-hsbcs-money-laundering-scandal-hbc-scbff-ing-cs-rbs0129.aspx https://www.investopedia.com/stock-analysis/2013/investing-n...