Attention turns to the contentious decision by the US not prosecute HSBC over various alleged misdemeanours 12 July 2016
TSC chair comes up with the wonderful question " Has the expression too big to fail become too big to jail?"
- Carney denies any discussions with fin min Osborne who has been accused of "intervening"
- not aware of any intervention by UK authorities
- need to take into account fin stability implications of serious allegations of bank misconduct
Background:
A US Congressional report revealed UK officials, including Chancellor George Osborne, added to pressure by warning the US it could lead to market turmoil. The report alleges the UK "hampered" the probe and "influenced" the outcome.
HSBC was accused of letting drug cartels use US banks to launder funds. The bank, which has its headquarters in London, paid a $1.92bn (£1.48bn) settlement but did not face criminal charges . No top officials at HSBC faced any charges.
The report says: "George Osborne, Chancellor of the Exchequer, the UK's chief financial minister, intervened in the HSBC matter by sending a letter to Federal Reserve Chairman Ben Bernanke... to express the UK's concerns regarding US enforcement actions against British banks."
The letter said that prosecuting HSBC could have "very serious implications for financial and economic stability, particularly in Europe and Asia".
Justice Department spokesman Peter Carr said a series of factors were considered when deciding how to resolve a case, including whether there may be "adverse consequences for innocent third parties, such as employees, customers, investors, pension holders and the public".
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