PHILIPPE LOPEZ/AFP/Getty Images(WASHINGTON) — The Securities and Exchange Commission on Tuesday charged the private banking arm of HSBC with violating the law by failing to register with the SEC before providing investment advisory and cross-border brokerage.
“HSBC’s Swiss private banking unit illegally conducted advisory or brokerage business with U.S. customers,” Andrew Ceresney, Director of the SEC’s Division of Enhancement said in a press release. The bank’s efforts to prevent registration violations “ultimately failed because their compliance initiatives were not effectively implemented or monitored.”
HSBC began conducting the business in question over 10 years ago. On at least 40 occasions, the SEC says, HSBC personnel traveled to the U.S. to solicit clients, provide investment advice and induce securities transactions — actions they were not registered to provide.
The SEC says that the bank has agreed to admit to its wrongdoing and that it will pay $12.5 million to settle the charges.
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