Page 159 - Bank Case Studies

Scandal broke out when Hervé Falciani, formerly an IT

expert at HSBC’s Swiss private bank, where almost $120

billion in investments was held, stole and leaked details of

30,000 client accounts from 2005-07. The files showed how

the Swiss private bank helped the wealthy evade taxes (see

Timeline).

At the beginning of 2015 HSBC was caught in a political

storm when the U.K. Parliament's Treasury Committee

questioned HSBC Chairman Douglas Flint and Chief
Executive Stuart Gulliver about personal accountability amid

allegations that its Swiss private bank helped wealthy

clients, including as many as 1,000 Britons, evade taxes.

Gulliver was personally dragged into the scandal when it

was reported that he himself had an account at the Swiss

private bank. Gulliver claimed that:

“he opened the account through a Panamanian

company to protect his privacy because other

executives at HSBC's Hong Kong offices were able to

see what colleagues were earning. He insisted he's paid

all his taxes and said the Panamanian structure was

closed. His salary and bonuses are now public.” (16)

When questioned by the Treasury Committee over the

bank’s actions Gulliver commented that he could not

monitor the activities of every employee in the bank.

This raised new questions about HSBC's conduct and

whether big banks like HSBC had become too big to manage
and moreover, who should be accountable when things

went wrong. (16)