By Kanga Kong
SEOUL--South Korea's financial watchdog will investigate whether
the local units of HSBC Holdings PLC (HBC) and Standard Chartered
(SCZ.ZM) were involved in money laundering, the Financial
Supervisory Service said Thursday.
"We will probe the Seoul branch of HSBC and Standard Chartered
Bank Korea in relation to (alleged) money laundering at their U.S.
and Mexico units," the FSS said in a statement. "We will look into
various issues related to (potential) money laundering, including
whether they reported suspicious transactions (to the authorities)
and verified their customers (before carrying out transactions) as
they're supposed to."
The news come at a time when the two U.K. banks are put under
fire in the U.S., with HSBC accused by a Senate investigation of
failing to prevent money-laundering at its Mexican subsidiary and
Standard Chartered called out for allegedly helping Iranian banks
to violate U.S. sanctions as well as misleading regulators.
Standard Chartered has denied the allegations made against it.
HSBC has accepted some wrongdoing took place. HSBC Chief Executive
Stuart Gulliver said last month the bank was working hard to
improve its compliance systems.
A spokesman for HSBC's Seoul branch declined to comment.
Standard Chartered Korea was not immediately available for
comment.
Write to Kanga Kong at kanga.kong@dowjones.com