Wednesday, June 08, 2011
HSBC bank has agreed to pay $62.5 million to bilked investors in Bernie Madoff's fund, but it does so without any admission of wrongdoing or liability. That is for the lawyers. Unfortunately, it doesn't help HSBC's reputation that is not subject to the letter of the law. People will think that with such a large settlement that HSBC must have known something, or it certainly would have fought the issue through the courts. On the other hand, fighting might have made the bank look worse -- big and unfeeling, the large bank out to crush the little investor. So, there is no good outcome other than what the bank is doing -- getting the issue behind it as quickly as possible. HSBC will need to rebuild its reputation over the coming years and hope that it never again meets another persuasive liar like Bernie Madoff.