LONDON • HSBC Holdings plc is shuttering accounts associated with the powerful Gupta family as it assesses its exposure to the scandal gripping South Africa.
The bank is conducting a wide-ranging review of any possible involvement in suspicious transactions, with the assistance of external investigators, people with knowledge of the matter said.
HSBC first closed accounts held by companies linked to the Gupta family in 2014 after internal compliance procedures picked up transactions that couldn’t be explained as legitimate business, the people said, asking not to be identified. Banks are required to report any transactions they suspect may be related to illicit activities.
“Any exposure that we had to the Guptas’ companies was inadvertent,” HSBC said in an emailed statement to Bloomberg News yesterday. “For the past couple of years, we have been in the process of identifying what there is and shutting it down.”
UK regulators last month said they are looking into whether HSBC and Standard Chartered plc facilitated money laundering as a result of possible ties to the Gupta family after a British pol it ician warned illicit funds may have passed through the United Arab Emirates and Hong Kong, where the banks have had large footprints.
The scandal around the Indian-born Gupta brothers, their business connections with the family of President Jacob Zuma and their alleged ability to direct state tenders have rocked South Africa’s government.