Senior MPs criticised the Financial Conduct Authority (FCA) and Revenue and Customs (HMRC) yesterday, after it was revealed the FCA was unaware of the wrongdoing at HSBC, and that HMRC had failed to pass on its concerns to the City watchdog.
The chairman of the FCA, Martin Wheatley, made a pre-arranged appearance in front of the Treasury select committee.
Labour MP John Mann said: “HSBC has been investigated by authorities across the world, but you, as the conduct authority, in this country have not even been informed about what HMRC have been investigating for five years.
He asked Wheatley: “How can you possibly be working with the bank from 2013 when you don’t have full knowledge of what they’ve been doing, and another part of the government does know, but isn’t informing you?”
The business secretary Vince Cable wrote to Douglas Flint, chair of HSBC, about “historic practices within HSBC designed to enable customers, including UK clients, to avoid paying tax”.
He also raised the situation of Sue Shelley, who had been head of compliance for HSBC in Luxembourg, but alleges she lost her job after raising concerns internally. Cable said in his letter that “these allegations would appear to raise questions about the extent to which the bank’s internal culture has been comprehensively reformed on this crucial point.
Meanwhile Labour ramped up pressure on the government, saying that they failed to act on HSBC in 2010.