Thousands of pages of account documents from 106,000 clients in 203 countries, leaked by a whistleblower and originally obtained by French newspaper Le Monde, suggest that HSBC helped wealthy clients evade hundreds of millions of pounds worth of tax.
The documents have now been obtained by more than 50 media outlets around the world, and the bank is now facing criminal investigations in the US, France, Belgium and Argentina, but in the UK says it is “co-operating with relevant authorities”.
In a statement, the bank admitted it was “accountable for past control failures” and said: “We acknowledge that the compliance culture and standards of due diligence in HSBC’s Swiss private bank, as well as the industry in general, were significantly lower than they are today.”
While the accusations relate to the corporate level of the company, HSBC’s BrandIndex scores from YouGov suggest the news has also affected consumers’ perceptions of the high street bank.
The brand’s “Buzz” score, which includes positive or negative messages consumers have heard through news, advertising or word of mouth, dropped to -6.9, putting HSBC at the bottom of a list of 28 banks, down seven spots compared to a week ago.
Its “Recommend” ranking, based on whether respondents would recommend or tell a friend to avoid a brand, dropped by 19 spots from 5th last week to 24th on the list today (10 February).
HSBC claims it has undergone a “radical transformation” in recent years and has looked to prevent its services from being used to evade taxes or launder money by reducing its number of Swiss accounts by almost 70% since 2007 and by placing a focus on compliance and tax transparency over profitability.
“We have taken significant steps over the past several years to implement reforms and exit clients who did not meet strict new HSBC standards, including those where we had concerns in relation to tax compliance,” a statement said.
HSBC will be hoping to avoid the reputation damage caused by Barclays LIBOR rate-rigging scandal in 2012, which saw the bank fined for manipulating the rates banks use to lend to each other in the wholesale market.
The corporate-level issue led to poor impressions of the bank, which directed it to rethink its communication strategy promising a “relentless focus on customers” in future marketing initiatives, further suggesting the important role corporate issues play in a consumer’s perception of a brand.