HSBC Bank Plc

Activities and protection

What they can do, and how you are protected

• Hold or safeguard your money FSCS may apply
  Eligible deposits are typically protected by the FSCS up to £120,000 per person, per banking group.
• Give regulated advice FSCS may apply
  A claim for unsuitable advice is itself FSCS-protected, up to the limit that applies to the product you were advised on.
• Manage or trade investments · Run or oversee funds FSCS may apply
  Eligible investment and pension claims are typically FSCS-protected up to £85,000 per person, depending on the product and your circumstances.
• Advise on or arrange mortgages FSCS may apply
  Mortgage advice and arranging may be FSCS-covered, up to the limit that applies.
• Lend or arrange credit No FSCS cover
  Consumer credit is not covered by the FSCS, so there is no compensation scheme if the firm fails.

Check your FSCS cover →

Complaints: You can refer a complaint about this firm to the Financial Ombudsman Service for free, whichever activity it relates to.

Track record

Action taken against them

6 fines between 2005 and 2024, £348.33m across 5 of the 6 that state an amount. This is part of the official register record and is worth reviewing before going ahead.

• Fined on 23 May 2024

  On 23 May 2024, the FCA fined HSBC UK Bank plc, HSBC UK Bank plc, Marks and Spencer Financial Services plc (HSBC). The reason for this action is that between 1 June 2017 and 31 October 2018, HSBC breached Principles 3 and 6 of the Authority’s Principles for Businesses, CONC 7.2.1R, 7.3.4R and 7.3.14R from its Consumer Credit sourcebook, and MCOB 13.3.2A from its Mortgages and Home Finance sourcebook for failures in its treatment of customers who were in arrears or experiencing financial difficulty.  The FCA’s action took effect on 23 May 2024 and a copy of the Final Notice is displayed on the FCA's web site.

  Read the FCA notice →

• Fined £57.42m on 30 January 2024

  HSBC Bank plc breached PRA Fundamental Rules 2,6,7,8 and Depositor Protection Rules 11,12,14 and 50 HSBC UK Bank plc breached PRA Fundamental Rules 2,6 and Depositor Protection Rules 11,12,14 Both entities were fined a combined £57,417,500 The PRA’s investigation uncovered that there were serious failings at the Firms in relation to the implementation of the DP Rules. The Firms’ failure to organise their affairs responsibly and effectively and to conduct their business with due skill, care and diligence contributed to these failings. HBEU failed in its preparations for resolution in respect of DP Rule compliance, and failed to deal with the PRA in an open and co-operative way by reason of it not providing information of which the PRA could reasonably have expected notice. See the published Final Notice for more details.

  Read the FCA notice →

• Fined £63.95m on 17 December 2021

  “On 17 December 2021, the FCA imposed a civil penalty on HSBC Bank plc. The reason for this action is because HSBC Bank plc failed to comply with Regulations 20(1)(a) and 20(1)(f) of the Money Laundering Regulations 2007 between 31 March 2010 and 31 March 2018. As a consequence of this action, the FCA imposed a penalty of £63,946,800. The FCA’s action took effect on 17 December 2021 and a copy of the Decision Notice is displayed on the FCA's web site.

  Read the FCA notice →

• Fined £216.36m on 11 November 2014

  The Financial Conduct Authority (the FCA) imposed a financial penalty of £216,363,000 on HSBC Bank plc (HSBC) of 8 Canada Square, Canary Wharf, London, E14 5HQ. The FCA's action took effect on 11 November 2014 and a copy of the Final Notice, which sets out the reasons for the action is displayed on the FCA's website and can be accessed via the following link: http://www.fca.org.uk/static/documents/final-notices/final-notice-hsbc.pdf The foreign exchange market (FX market) is one of the largest and most liquid markets in the world. Its integrity is of central importance to the UK and global financial systems. Over a period of five years, HSBC failed properly to control its London voice trading operations in the G10 spot FX market, with the result that traders in this part of its business were able to behave in a manner that put HSBC's interests ahead of the interests of its clients, other market participants and the wider UK financial system. The FCA expects firms to identify, assess and manage appropriately the risks that their business poses to the markets in which they operate and to preserve market integrity, irrespective of whether or not those markets are regulated. The FCA also expects firms to promote a culture which requires their staff to have regard to the impact of their behaviour on clients, other participants in those markets and the financial markets as a whole. HSBC's failure adequately to control its London voice trading operations in the G10 spot FX market is extremely serious. The importance of this market and its widespread use by market participants throughout the financial system means that misconduct relating to it has potentially damaging and far-reaching consequences for the G10 spot FX market and financial markets generally. The failings described in the Final Notice undermine confidence in the UK financial system and put its integrity at risk. HSBC breached Principle 3 of the FCA's Principles for Businesses in the period from 1 January 2008 to 15 October 2013 (the Relevant Period) by failing to take reasonable care to organise and control its affairs responsibly and effectively with adequate risk management systems in relation to G10 spot FX voice trading in London. References in the Final Notice to HSBC's G10 spot FX trading business refer to its relevant voice trading desk based in London. During the Relevant Period, HSBC did not exercise adequate and effective control over its G10 spot FX trading business. HSBC relied primarily upon its front office FX business to identify, assess and manage risks arising in that business. The front office failed adequately to discharge these responsibilities with regard to obvious risks associated with confidentiality, conflicts of interest and trading conduct. The right values and culture were not sufficiently embedded in HSBC's G10 spot FX trading business, which resulted in it acting in HSBC's own interests as described in the Final Notice without proper regard for the interests of its clients, other market participants or the wider UK financial system. The lack of proper control by HSBC over the activities of its G10 spot FX traders in London undermined market integrity and meant that misconduct went undetected for a number of years. HSBC's control and risk functions failed to challenge effectively the management of these risks in the G10 spot FX trading business. HSBC's failings in this regard allowed the following behaviours to occur in its G10 spot FX trading business: (1) Attempts to manipulate the WMR fix rate, alone or in collusion with traders at other firms, for HSBC's own benefit and to the potential detriment of certain of its clients and/or other market participants; (2) Attempts to trigger clients' stop loss orders for HSBC's own benefit and to the potential detriment of those clients and/or other market participants; and (3) Inappropriate sharing of confidential information with traders at other firm, including specific client identities and, as part of (1) and (2) above, information about clients' orders. These failings occurred in circumstances where certain of those responsible for managing front office matters were aware of and/or at times involved in behaviours described above. They also occurred despite the fact that risks around confidentiality were highlighted when HSBC's Compliance department identified instances of inappropriate internal disclosures of client confidential information by FX sales and trading staff in 2008 and 2009. HSBC was aware during the Relevant Period of misconduct associated with LIBOR / EURIBOR, which was identified in well-publicised Final Notices issued against other firms from June 2012 onwards. HSBC was not subject to enforcement action by the FCA for LIBOR / EURIBOR misconduct during the Relevant Period. It nonetheless engaged in an extensive remediation programme across its businesses in response to these Notices. This included enhancements to the governance and controls around submissions-based benchmarks and more widely. Despite these improvements, the steps taken during the Relevant Period in its G10 spot FX trading business did not adequately address the root causes that gave rise to failings described in the Final Notice. The FCA acknowledges the significant co-operation and assistance provided by HSBC during the course of its investigation. HSBC is continuing to undertake remedial action and has committed significant resources to improving the business practices and associated controls relating to its FX operations. It has taken important steps to promote changes to culture and values across its business. The FCA recognises the work already undertaken by HSBC in this regard. The Final Notice relates solely to HSBC's conduct in its G10 spot FX trading business in London. It makes no criticism of any entities other than the firms engaged in misconduct as described in the Final Notice.

• Fined £10.5m on 5 December 2011

  On 2 December 2011 the FSA imposed a financial penalty of £10,500,000 on HSBC Bank plc (HSBC) relating to investment advice and sales of investment products provided by one of its subsidiaries, NHFA Limited (NHFA), between 15 July 2005 and 20 July 2010 (the Relevant Period). During the Relevant Period, 2,485 customers were advised to invest in asset-backed investment products, typically investment bonds, which were used to fund long-term care costs for elderly customers. The sales were made by NHFA and resulted in a breach of Principle 9 (Customers: relationships of trust) of the FSA's Principles for Businesses and associated rules. HSBC agreed to settle at an early stage of the FSA's investigation. It therefore qualified for a 30% (stage 1) reduction in penalty, pursuant to the FSA's executive settlement procedures. Were it not for this discount, the FSA would have imposed a financial penalty of £15,000,000 on HSBC. The failings identified in respect of NHFA sales included the following: 1) In a number of cases reviewed the customer's life expectancy at the point of sale was less than the minimum recommended term of the investment (five years). That meant that it was likely the charges on the bond would reduce capital to such an extent that the product was unsuitable. 2) There was no consistent approach to assessing customers attitude to risk or use of a suitable risk profiling questionnaire. This deficiency in the sales process meant that advisers often recommended investment strategies to customers that were inconsistent with the customers tolerance for risk. 3) There was inadequate diversification of investments and savings plans. The majority of recommendations were for investment bonds with little or no consideration given to the use of other suitable forms of investments such as OEICs/unit trusts, ISAs, National Savings and fixed rate deposits. A review of customer files showed that, in the majority of cases, a different product should have been recommended or no product should have been recommended at all. 4) Advisers failed to consider the tax status of customers before making a recommendation. As a result customers may not have been aware of suitable alternative investments which were potentially more tax efficient for their individual circumstances. 5) Customers were given recommendations to invest a high proportion of funds into asset-backed investments with only a small amount of funds left readily available to them on deposit. This resulted in many cases in high levels of withdrawals from the invested assets being necessary despite this being foreseeable at the time of the recommendation. The combination of withdrawals and product charges led to faster reduction of capital than should have been the case if customers had received the right advice. 6) The suitability letters issued by NHFA advisers to customers were inadequate in that they: a) were not tailored to the circumstances of the individual customer; b) focussed unduly on the benefits of an investment without providing sufficient warnings about the possible disadvantages; and c) contained inaccurate or irrelevant information. As a consequence of the failings, NHFA customers were exposed to an unacceptable risk of mis-selling and a significant number of asset-backed investments were mis-sold. The FSA views these failings as particularly serious because: 1) NHFA was the leading supplier in the UK of independent financial advice on long-term care products to help pay for care costs, with a market share in recent years approaching 60%; 2) NHFA's customer base was particularly vulnerable given the customers age and in many cases they were reliant upon their investments to fund their care costs. They therefore had limited means or opportunity to make up any financial loss resulting from an unsuitable sale. This risked impacting on their ability to fund care arrangements; 3) the mis-conduct occurred over a period of approximately 5 years; 4) aignificant number of customers may have suffered financial detriment. During the Relevant Period 2,485 customers invested in asset-backed products. The total amount invested was approximately £285 million, meaning the average amount invested per customer was approximately £115,000. HSBC estimates that the amount of redress to be paid to affected will be approximately £29.3 million; and 5) HSBC is a major global financial services provider with a prominent position in the retail consumer market. The failings therefore merit the imposition of a substantial financial penalty. In deciding upon the appropriate level of penalty, the FSA has taken the following into account: 1) HSBC identified the serious failings at NHFA, provided a report to the FSA and implemented a comprehensive improvement programme at NHFA to address its failings. This involved making improvements to NHFA's sales processes and the training provided to its managers and advisers. As a result, a review by a third party of a sample of NHFA sales made after July 2010 demonstrated significant improvements; 2) HSBC has taken a proactive approach to reviewing all sales made by NHFA between April 2004 and July 2010 to determine where redress should be paid. Given the vulnerability of the customer base and the time elapsed, HSBC will not make contact with the customers or the advisers involved. Sales have been reviewed on the basis of the information available on the file only. Where it is unclear if the file was suitable, HSBC will assess the file as unsuitable and pay full redress; 3) HSBC implemented the customer redress programme, with a third party, before the referral to enforcement was made; and 4) HSBC agreed the facts of the investigation quickly and the FSA was able to rely on its review of NHFA sales and a review by a third party without further extensive investigation being necessary. HSBC closed NHFA to new business on 1 July 2011.

• Fined £100,000 on 14 December 2005

  On 14 December 2005, the FSA imposed a financial penalty of £100,000 on HSBC Bank plc (HSBC) for failing to take reasonable steps to ensure the accuracy of transaction reports it made to the FSA from December 2002 until August 2005. In failing to ensure the accuracy of its transaction reports, HSBC breached SUP 15.61R of the FSA Rules.

Common questions

Frequently asked questions