European Stocks Plunge Most Since July on Concern Over Lockdowns

Marco Green
September 21, 2020

The investigation, which was led by 108 worldwide media outlets from 88 different countries, is based on thousands of suspicious activity reports (SARs) submitted to the US Treasury Department's financial law enforcement agency, FinCEN, by banks from around the world.

Shares of HSBC Holdings Plc, already trading at decade lows, slid 3.2%. The stock has now almost halved since the start of the year.

The five all saw their share prices fall back Monday - JPMorgan losing 2.7%, HSBC off some three percent, Standard Chartered off 4.7%, Deutsche losing nearly seven percent and Bank of New York Mellon down 1.9%.

It comes as Asian shares and most currencies held tight ranges on Monday, as investors awaited developments on USA fiscal stimulus and coronavirus vaccines amid a resurgence of infections in Europe.

This morning on the Hang Seng, HSBC shares shed 5.3%, bringing their value to USA $3.78 - the lowest since 1995.

HSBC, the bank at the centre of the scandal, saw its share price fall more than 5% in London, but the revelations dragged down the entire sector, with Barclays, Lloyds and NatWest all dropping about 6%.

Shares in major banks dived after Buzzfeed News and the International Consortium of Investigative Journalists published findings over dirty money allegedly flowing through institutions.

The SARs showed that banks often moved funds for companies that were registered in offshore havens, such as the British Virgin Islands, and did not know the ultimate owner of the account, the report said.

In some cases the banks kept moving illicit funds even after US officials warned them they could face criminal prosecutions if they continued to do business with criminals or corrupt regimes, it said.

Global banks in the recent years have boosted investments on technology and staff to deal with tighter anti-money laundering and sanctions regulatory requirements across the world.

In a statement released prior to the investigation's publication, FinCEN said that the "unauthorized disclosure of SARs is a crime that can impact the national security of the United States".

HSBC said in a statement to CNBC that "we do not comment on reports of suspicious activity". In 2012, HSBC introduced stringent measures to uplift its ability to minimise financial crimes.

Other reports by Click Lancashire

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