HSBC 'helping Arab leaders stash billions in Swiss banks'

HSBC 'helping Arab leaders stash billions in Swiss banks'
One of world's biggest banks aided many close to Ben Ali, Assad and Mubarak funnel personal fortunes out of country, according to report based on leaked papers.
3 min read
11 February, 2015
HSBC is one of the most well known banks in the region

HSBC is alleged to have helped officials close to Middle East dictators funnel billions of dollars out of their countries and into Swiss bank accounts.

The regimes of Syria's Bashar al-Assad, Tunisia's Zine el-Abidine Ben Ali, and Egypt's Hosni Mubarak's have been mentioned in documents published in a report by the International Consortium for Investigate Journalists.

The ICIJ report, based on thousands of leaked files from HSBC's Swiss operations, said that HSBC "served those close to discredited regimes such as ... Hosni Mubarak... Ben Ali and Bashar al-Assad".

The leaks have caused a political storm across Europe, with reports that the British Tory party received $5m from donors who used Swiss accounts to shelter their wealth from UK tax. The practice is legal, although many in the UK have called for such loopholes to be closed.

The ICIJ reports also lists a number of Arab royal families who used the bank's Swiss services, including those in Bahrain, Jordan, Oman and Morocco.

Documents published by the ICIJ show how HSBC's private bank in Switzerland helped 11,088 Arab clients hide an estimated $26bn fortune outside their countries.

No data is available beyond 2007 - four years before the Arab Spring - making it likely that the real figure is significantly higher.

The French newspaper Le Monde revealed that HSBC's Swiss bank had put its expertise at the disposal of Saudi princes to "attract [their] wealth".

"The list also includes daughter of late King Faisal bin Abdul Aziz al-Saud, Princess Lolowah, who is listed as a 'housewife', even though she is the deputy chairwoman for Saudi Arabia's first university for women," Le Monde says.

The French newspaper also quoted a July 2005 report by an employee at the bank saying Saudis were at the top of the bank's Arab clients, ranking 11th on their international list.

The bank has a total of 2,762 bank accounts for 1,504 Saudi clients valued at a total of $5.8bn.

Former Saudi intelligence chief Prince Bandar bin Sultan is among the most famous clients on the list. He has been a client at HSBC's private bank in Switzerland since 1999.

     Arab clients have hidden an estimated $26 billion fortune outside their countries.

Bandar had four bank accounts including one opened in 2005 under the name CAF Invest Operating Ltd, with three sub-accounts opened in 2006 and 2007, and valued at a total of $15.6 million. Two accounts were closed in 2000, while the third remained empty.

In April 2014, a royal decree dismissed Prince Bandar from his position as Saudi intelligence chief, supposedly based on his request.

In January 2015, King Salman fired him from his position as head of the Saudi national security council.

Egyptian clients ranked third, after the Lebanese, among Arab clients, and 20th on the international clients' list, with 700 clients holding 1,478 accounts valued at a total of $3.5bn.

There are conflicting estimates about how much money was smuggled out of Egypt during Mubarak's 30 years in power.

In 2012 the Egyptian parliament's foreign relations committee estimated the smuggled money at roughly $134bn. Other analysts suggest the amount was $70bn.

Among the main Egyptian officials on list was former trade minister, Rashid Mohammad Rashid, who became a client at the private Swiss bank in 2003, with 10 accounts valued at a total of $31m in 2006/2007.

The lists included 2,998 Lebanese clients, with 4,450 accounts valued at $4.8bn, while the UAE ranked 4th in the Arab world, with 1,702 accounts for 1,126 clients, valued at $3.5bn.

There were also 1,068 Moroccan clients on the list, with 2,200 accounts valued at $1.6bn, followed by Syria, with 1,281 accounts for 690 clients, valued at $1.3bn. 

The list also includes 475 Kuwaiti clients with 674 accounts valued at $1.1bn.

This article is an edited translation from our Arabic edition.