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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: TobagoJack who wrote (64366)	6/23/2010 4:03:56 AM
From: elmatador	Respond to of 217830

HSBC U.S. unit to cut ties with Angolan banks By Henrique Almeida LUANDA, June 22 (Reuters) - A U.S. unit of HSBC (HSBA.L)(0005.HK) has cut ties with some Angolan banks, a source with direct knowledge of the matter said, months after a U.S. Senate investigation criticised it for lax oversight of accounts held by Angolans, including a former central bank governor. Twice the size of Texas, the southwest African country is a lucrative prospect for big Western lenders: its economy is expected to grow by 8.6 percent this year, yet only 11 percent of the 16.5 million population use banks. But like Citigroup (C.N) before it, HSBC appears to have been stung by the oil-rich African nation, which ranked in the bottom 19 of 180 countries in a Transparency International corruption study last year. HSBC Bank USA told some Angolan banks last month it would no longer do business with them, said the source, who declined to be identified. "HSBC Bank USA told banks in Angola it will close all U.S. dollar accounts and end all fund transfers with them this month," the source said. It was not immediately clear how many Angolan banks would be affected, or whether other units of HSBC would still do business in the country. Officials for HSBC Bank USA in New York and HSBC in London declined to comment. "We know that Citibank pulled out of Angola in 2003 because the concern of money laundering outweighed the benefits of accessing the lucrative Angolan market," said Diarmid O'Sullivan, a U.K.-based campaigner for anti-corruption watchdog Global Witness. "There is a continuing risk for any international bank until Angola cleans up its act." Angola has about 20 banks, none of which are listed. SUSPECT TRANSACTIONS A February report by the United States Senate permanent subcommittee on investigations said that in 2002, the then-governor of Angola's central bank, Aguinaldo Jaime, attempted to move $50 million of state funds into a private U.S. account and that HSBC had been slow to recognise potentially suspect transactions. The 325-page report said Jaime first attempted to transfer the money using other banks before turning to Citigroup unit Citibank, and eventually, HSBC. Concern about the attempted transactions prompted Citibank to end its relationships with the Angolan government, the subcommittee said. "In contrast, HSBC personnel facilitated multiple wire transfers of the $50 million ... until a compliance officer warned about a possible scam." Jaime was not available for comment and two messages left on his mobile phone were not returned. HSBC continued to do business with the central bank and may be providing it with offshore accounts in the Bahamas, the subcommittee said. U.S. Senator Carl Levin, chairman of the subcommittee, said at a February hearing that HSBC also helped the central bank avoid a British court order freezing some of its assets. [ID:nN04103975] The central bank is currently the target of an embezzlement probe by Angola's attorney general that has led to dozens of arrests of middle- and low-level employees. [ID:nLDE64Q1UX] It was not immediately clear if HSBC planned to cut ties with the Angolan central bank. A central bank spokeswoman, Amelia Borja, said she was "not aware" of such a decision by HSBC. BAI CONNECTION The subcommittee also criticised HSBC's dealings with Banco Africano de Investimentos, Angola's largest lender by deposits. HSBC failed to designate BAI as a "high-risk client", even though the bank refused to fully disclose its owners or provide information on its anti-money laundering controls. For ten years BAI gained entry to the U.S. financial system through HSBC accounts in New York and other services, the subcommittee said. BAI spokesman Diala Monteiro was not available for comment. Some of BAI's clients are so-called Politically Exposed Persons, the subcommittee said, meaning politically powerful foreign officials, their relatives and close associates. Banks are required under the USA Patriot Act of 2001 to closely scrutinise the private accounts of senior foreign officials. HSBC's decision to close the accounts mirrors the move by Citibank in 2003. At that time, the U.S. bank expressed concern about Angolan corruption in a memo obtained by the subcommittee. "We are uncomfortable with the character of the senior officials in the Angola government and any amount of policing may not deter financial impropriety," the memo said. (Additional reporting by Steve Slater in London; Editing by David Dolan and Sitaraman Shankar)