Banks & regulators must counter tax cheats and stay business-friendly

THE scandal that has erupted anew over HSBC's apparent role in helping clients evade taxes through Swiss bank accounts is one that has played out several times in the recent past in the financial industry.

In 2009, UBS paid US$780 million to settle a tax evasion probe by the US Justice Department. In 2012, Standard Chartered Bank agreed to a US$340 million fine with the New York State Department of Financial Services for hiding transactions with Iran. Last year, it agreed to another US$300 million fine over its failure to tighten anti-money-laundering controls. Even for HSBC it is déjà vu, albeit arguably a far more damaging one. In 2012, it was fined US$1.9 billion by the United States for its role in helping to launder drug money in Mexico. The current revelations, which stem from documents stolen by a former employee, chronicle dealings in its Swiss subsidiary dating back to pre-2007, when employees evidently facilitated t…