HSBC’s chairman and chief executive have declined to shoulder individual blame for staff aiding tax evasion which took place at the Swiss private bank between 2005 and 2007, despite apologising to MPs.
Grilled by MPs at the Treasury Select Committee yesterday, HSBC group chairman Douglas Flint and chief executive Stuart Gulliver both accepted conduct at the bank was unacceptable.
Gulliver said: “I would like to put on the record an apology from both myself and Douglas for the unacceptable events that took place at our private bank in Switzerland in the mid-2000s. It is an apology we would like to make to you, our customers, our shareholders and the public at large.”
However, Gulliver insisted that although he held some accountability, both he and Flint had helped to install reforms at the bank to improve controls.
He said: “I have been group chief executive since 2011, so I have collective responsibility for the group. But I’m responsible for cleaning it up, and I have made substantial changes.”
Flint added that the bank’s Swiss staff should carry the blame for the alleged infractions.
“Most accountable, I think are the management in Switzerland. It’s very difficult for people outside of Switzerland to get access to the detailed account information,” Flint said.
“The most culpable people are the relationship managers who did what they did.”
Of relationship managers in place between 2005 and 2007, Flint estimated that 30 per cent continue to hold roles at HSBC’s Swiss private bank.
“Those that have stayed have been vetted, screened and managed to make sure that, as far as we can see, they are adopting our policies in an appropriate way,” he said.
Between 2005 and 2007, Flint was serving as the bank’s group finance director, later becoming group chairman in December 2010.
Gulliver, meanwhile, was named chief executive of Global Banking and Markets and HSBC Global Asset Management, excluding Switzerland, in May 2006 and joined the board of HSBC’s Swiss private bank in September 2007.
However, despite joining the Swiss board, Gulliver maintained that he held only a “non-operational” role.
“I was not involved in its day-to-day management, and from 2008 onwards we started to restructure that private bank,” Gulliver said.
Pushed by MPs on whether he should sack Gulliver, Flint said: “I think he’s doing an excellent job.”
The HSBC chairman added that while he had not received a bonus since 2010, he did not feel it would be appropriate to waive any bonus received this year.
“I don’t feel that proximate to what was happening in the private bank,” he said.