Tuesday, February 10, 2015
A now former employee of HSBC bank stole thousands of files from its computer systems and created a major reputational crisis for the institution. The files reveal that the bank helped thousands of wealthy people, including crooks, hide money from tax authorities in Swiss accounts. The employee who took the data considers himself a whistleblower. The bank calls him a common thief. No matter. The situation in which the bank is caught will cost it hundreds of millions in fines, if not billions. There is no out for the institution. E-mails state openly that bank employees were helping clients squirrel away money and were not particular about where it came from. Call that the dark side of client service. One wonders why in this era of transparency that a bank might think it could get away with such behavior. Apparently, the question never occurred to HSBC's leadership or they turned a blind eye to what was happening in their ranks. HSBC will now undergo an excruciating examination by tax authorities from several countries and it might well wish that it had been more vigilant in the first place. It will take years to rebuild its reputation as an honest bank.