That is a great example. But HSBC is hardly as innocent as you're making out.

http://www.rollingstone.com/politics/news/outrageous-hsbc-se...

> Breuer admitted that drug dealers would sometimes come to HSBC's Mexican branches and "deposit hundreds of thousands of dollars in cash, in a single day, into a single account, using boxes designed to fit the precise dimensions of the teller windows."

The gist of the case is that HSBC were so brazenly negligent, that the only logical conclusion is that they were deliberately looking the other way in order to make more profit, and they paid $1.9B to make the problem go away. That's on $670 billion in wire transfers and $9.4 billion in cash transactions from its Mexico bank operations during the period under question [1].

[1]: http://money.cnn.com/2012/12/10/news/companies/hsbc-money-la...

What exactly does it prove that drug dealers had boxes designed to fit through teller windows? Particularly about executives that have probably never seen a teller window at a Mexico HSBC branch.

> The gist of the case is that HSBC were so brazenly negligent, that the only logical conclusion is that they were deliberately looking the other way in order to make more profit, and they paid $1.9B to make the problem go away.

Even if that's true, note how many steps removed it is from actual culpable conduct. You're not the drug dealer, you're not the guy employed by the drug dealer to launder his money, you're not the guy assisting in specific money laundering transactions you know about. You're the guy who doesn't bother to find out more about certain transactions to avoid learning that they may be illegal. There is, of course, no universal "due diligence" requirement to find out whether bad people are using your service for bad things. The only "due diligence" you have to do is what the government makes you do. Here, the allegation was that HSBC didn't do the diligence the government would have made it do had HSBC classified Mexico in a risk category that government did not make HSBC classify Mexico in.

I'd have thought that a deposit of "hundreds of thousands of dollars in cash, in a single day" should trigger some KYC / money laundering checks. You certainly can't do that in the US without getting a ping on your account.

You are repeating your previous assertion about how the case is actually about a technicality that HSBC shouldn't have been held to. Can you provide a citation for that?

From the CNN article I linked, "The DOJ said HSBC also helped process $660 million in prohibited transactions from Iran, Cuba, Sudan, Libya and Burma by deliberately hiding the identities of these countries."

That doesn't sound like "HSBC didn't do the diligence the government would have made it do", it sounds like more willful misdirection on their part.

Edited to add:

> The only "due diligence" you have to do is what the government makes you do.

I don't think this is true. Doing your "due diligence" doesn't protect you against activity that is otherwise criminal, it just protects you from being in breach of your regulatory requirements, and the penalties that are included in those regulatory frameworks. "Due diligence" doesn't protect you if you murder someone, and it doesn't protect you if you commit another crime, like (say) conspiracy to launder drug money.

The problem is white-collar criminals wrote the laws, not that it's hard to identify crime.

The people writing the laws don't tend to define themselves as criminals so your thesis seems rather weak.

Criminals rarely self-identify. It's everyone else's job to do that.

It's actually the law's job to do that.