Monday, March 18, 2013 8:35 pm
Argentina: HSBC helped launder money, evade taxes
By DEBORA REYAssociated Press
Tax chief Ricardo Echegaray said HSBC's Argentina subsidiary created an illegal scheme enabling its clients to hide more than $100 million. He said the scheme included a criminal organization and fake receipts used to launder money for various companies.
HSBC's Latin America spokeswoman, Lyssette Bravo, issued a statement that did not deny the accusations and promised to cooperate.
"HSBC takes compliance with the law, wherever it operates, very seriously and strongly supports the efforts of governments and regulators to detect unlawful activity and take appropriate action," the statement said.
Echegaray said that since February, the bank "had been rolling out a fraud-enabling platform" that he called "a maneuver to hide bank account information from tax collectors."
He named three companies: Mas Distribuidora SA, Recaudaciones y Servicios del Sur SRL and Red de Multiservicios SA.
"They evaded taxes and laundered money through the purchase of fake receipts that were later used to justify the issuance of checks whose amounts were deposited under a generic tax identification number," Echegaray said, adding that HSBC never informed the AFIP tax agency about it.
The three companies used "phantom operations" to deposit checks laundering $76 million and evaded taxes on an additional $44 million, he said.
The tax agency is pursuing a criminal investigation against HSBC in Argentina's courts.
"They have to pay what they owe and break up this band of crooks, which involved private figures as well as public authorities in the purchase of fake receipts," Echegaray said.
HSBC's statement said Argentina's allegations were a matter of great concern. "We are committed to working cooperatively with authorities to ensure a thorough review and appropriate resolution of the matter."
Last year, HSBC paid nearly $2 billion to settle a money-laundering case involving illicit drug money from Mexico brought by U.S. and U.K. officials. The bank's head of compliance resigned from his position and apologized to the Senate investigation last year after it was found HSBC had lax controls that exposed it to money-laundering and terrorist financing.