Ex-HSBC North America executive sued for fraud

Bloomberg

The former head of HSBC Holdings Plc’s North American interest rates business was sued for fraud by the US Commodity Futures Trading Commission (CFTC).
Christophe Rivoire helped manipulate the price of an interest rate swap between the bank and a bond issuer, the CFTC said in a complaint filed in Manhattan federal court. The agency claimed the issuer had negotiated with the bank to price a bond and related swaps using US dollar interest rate basis swaps with a five-year maturity.
According to the CFTC, Rivoire in July 2012 directed a trader he supervised to trade in a way to reduce the prices for the five-year basis swaps to make the transaction more profitable for HSBC. As a result, the trader, who isn’t named, worked with a broker at an unidentified interdealer broker firm to time the sale of a large quantity of swaps in a way that would manipulate the prices as displayed on broker screens.
Rivoire falsely told the issuer “Obviously we are not controlling the screen,” according to the CFTC. The move reduced the value of the transaction for the issuer and deceived other market participants, the CFTC said in its complaint.
The CFTC is seeking an order imposing civil fines and a trading ban on Rivoire, a French national didn’t immediately respond to an email sent through LinkedIn. HSBC called the case “a historical matter.”
“In the last several years, we have significantly strengthened our compliance procedures and controls and reinforce the high standards of conduct expected of our people,” the company said in a statement. “HSBC is committed to delivering fair outcomes for customers and protecting the orderly and transparent operation of markets.”
Finra records show that the CFTC notified HSBC in May 2016 that it was investigating the swap transaction and had subpoenaed information relating to Rivoire. HSBC said at the time that it was cooperating with the investigation.

HSBC defends itself over accounts linked to HK arrests
Bloomberg

HSBC Holdings Plc moved to defend itself after Hong Kong police announced arrests linked to an account the bank closed last month.
The bank took to Twitter and Facebook and also sent a memo to staff saying that the decision to shutter the protest-linked account was unrelated to the “current Hong Kong situation.”
“We never take decisions to close any account lightly,” Maggie Cheung, a bank spokeswoman, said in a follow up email. “Our decision is completely unrelated to the Hong Kong Police’s arrest of the four individuals on 19 December 2019. We closed the account in November 2019 following direct instruction from the customer.”
The account controversy resurfaced on after police arrested four people for suspected money laundering linked to the pro-democracy protests and froze $9 million) in funds related to the Spark Alliance.