Saturday, July 2, 2011

U.S. bribery inquiry into $1.4bn held by HSBC for Gaddafi - 1st July 2011

HSBC faces being caught up in a U.S. bribery inquiry over hundreds of millions of pounds it held on behalf of Libya.

There has been a dramatic rise in deposits with the bank, according to a leaked internal report from the Libyan Investment Authority – which invests some £40billion of oil wealth collected by Colonel Gaddafi's regime.

Last June, HSBC held £182million of Libya's money, the document shows.

Just three months later, that had risen to more than £870million.

As details of the report emerged, sources said HSBC could be caught up in a U.S. investigation looking at whether banks paid Libyan officials in return for managing the North African nation's money.

The Serious Fraud Office, which prosecutes white-collar crime in the UK, is understood to be helping U.S. regulators with their inquiries into banks that did business with Gaddafi's regime.

Insiders said the investigation revolves around allegations that banks, hedge funds and private equity firms paid so-called 'placement agents' in return for being given access to Libya's state investment fund.

One source confirmed that the U.S. Securities and Exchange Commission was looking into HSBC, Britain's biggest bank, as it casts its net for evidence. Read More