WASHINGTON, D.C. – The 2012 Department of Justice settlement with international bank HSBC over hundreds of millions of dollars in criminal money-laundering for drug cartels and terrorist groups identified with Iran hang like a sword of Damocles over Special Prosecutor Robert Mueller’s indictment of Robert Mueller and Rick Gates.
The settlement, announced in a Department of Justice press release dated Dec. 11, 2012, involved a deferred prosecution agreement in which HSBC admitted criminal responsibility for money-laundering at least $881 million through the U.S. financial system, as well as an unspecified amount of money from federally sanctioned countries including Iran, Cuba, Sudan, Libya, and Burma.
In exchange for the Department of Justice agreeing not to file criminal indictments against HSBC’s directors, officers, or employees, HSBC agreed to pay $1.256 billion as part of the deferred prosecution agreement, plus another $665 million in civil penalties, with HSBC admitting criminal violations of the Bank Secrecy Act (BSA), the International Emergency Economic Powers Act (IEEPA), and the Trading with the Enemy Act (TWEA).
The Director of the FBI at that time was Robert Mueller. Robert Comey, who replaced Mueller as FBI director, was a member of the HSBC board of directors. The case was settled by Loretta Lynch, who then was U.S. Attorney for the Eastern District of New York. And the Attorney General was Eric Holder.
Just to make sure the case is clear, please understand the Obama Department of Justice allowed HSBC to pay fines to avoid facing federal criminal indictments after HSBC admitted criminal responsibility for helping Mexican drug cartels and terrorist organizations with ties to countries like Iran launder hundreds of millions of dollars into the U.S. banking system from foreign sources.
Contrast this to Mueller’s decision to indict Manafort and Gates on criminal money laundering charges.
To begin with, Manafort and Gates have maintained that the money involved in Mueller’s indictment involved payment from Ukraine for consulting services rendered that involved no illegal activity.
This point is critical: unless the government can prove the money was illegally obtained, money-laundering criminal statutes do not apply.
Consider the following:
- First, is not a crime for a U.S. citizen to be paid for consulting services rendered to a foreign government.
- Second, it is not a crime for U.S. citizens to move money earned overseas into the United States through offshore banks, even if the banks are domiciled in known off-shore money-laundering jurisdictions, such as the Cayman Islands or the Seychelles.
- Third, as long as Manafort and Gates reported the income and paid all required federal taxes, it is no crime to deposit in a U.S. bank funds owned overseas that were moved into the U.S. banking system via transfers involving off-shore banks.
Contrast this to the HSBC case where Mueller, Comey, Lynch, and Holder all knew HSBC was involved in the criminal money-laundering hundreds of millions of dollars (a vastly larger sum than involved in the Manafort-Gates case) for heinous international narcotics cartels and terror groups resolved to kill Americans.
Yet, Mueller, Comey, Lynch, and Holder were satisfied to be paid a fine that to HSBC amounted to nothing more than the cost of doing business.
As ZeroHedge.com pointed out in 2015 after the revelations from a trove of secret documents from HSBC’s Swiss private bank (#SwisLeaks), HSBC could no longer claim the money-laundering was due to a few rogue employees and a loosely enforced anti-money laundering policy.
“The truth is that a considerable portion of the global banking system is explicitly dedicated to handling the enormous volume of cash produced daily by dope traffickers,” ZeroHedge.com noted.
The Senate Permanent Subcommittee on Investigations concluded that HSBC also had a longstanding relationship with Saudi Arabia’s al-Rajhi bank, described by the CIA in 2003 as a “conduit for extremist finance.”
U.S. intelligence had assessed that al-Rajhi founder Sulaiman bin Abdul Aziz was “a member of Osama bin Laden’s ‘Golden Chain’ financiers of al-Qaeda, and had in that capacity pushed al-Rahji bank to find ways to avoid subjecting the bank’s charitable donations to official scrutiny.”
Finally, since the Vietnam War, HSBC was the CIA’s money-laundering bank-of-choice to launder the proceeds the CIA was deriving from running the international heroin trade originating in Southeast Asia.
Journalist and political activist Dean Henderson documented in his 2007 book: “Big Oil and Their Bankers in the Persian Gulf” the following:
Formerly known as Hong Kong Shanghai Bank Corporation, HSBC has served as the world’s #1 drug money laundry since its inception as a repository for British Crown opium proceeds accrued during the Chinese Opium Wars. During the Vietnam War, HSBC laundered CIA heroin proceeds.
Peter Dale Scott, in his 2014 book, “The American Deep State: Wall Street, Big Oil, and the Attack on U.S. Democracy,” made a similar observation writing the following:
Since World War II the CIA has made systemic us of drug trafficking forces to increase its covert influence – first in Thailand and Burma, then in Laos and Vietnam, and most recently in Afghanistan. With America’s expansion overseas, we have seen more and more covert programs and agencies, all using drug traffickers to different and opposing ends.
Evidently with the HSBC criminal money-laundering case in 2012, FBI Director Mueller agreed with future FBI Director Comey, along with U.S. Attorney Loretta Lynch and Attorney General Eric Holder, it was better to let HSBC off the hook than to take the risk a fearless defense attorney would expose the CIA’s role in the international drug trade.
Investigative journalist Nafeez Ahmed said, in a 2015 article entitled “Death, Drugs and HSBC,” it is fairly simple once you understand that “fraudulent blood money makes the world go around.”
Matt Taibbi, writing in the Rolling Stone in 2013 capsulized the HSBC case in the title of his article: “Gangster Bankers: Too Big to Jail,” subtitled “How HSBC hooked up with drug traffickers and terrorists. And got away with it.”
The HSBC settlement will haunt Mueller and his special counselor “witch hunt,” once the American public realizes the Manafort-Gates prosecution is at best a case of technical violations in failing to register, or possibly a tax evasion case. But the case has nothing whatsoever to do with money-laundering since consulting with Ukraine is not a crime in the United States.
Rather, the entire goal of Mueller’s indictment is to establish the predicate for undermining Donald Trump’s presidency politically, and possibly to establish the grounds for impeachment. What we must realize from the start that even if there were evidence the Trump campaign had colluded with Russia, there is no federal law that makes “collusion” a crime.
What the HSBC criminal case and the Manafort-Gates indictment prove is that Deep State actors including Mueller, Gates, Lynch, and Holder, can be counted upon to protect their own.