SEC Charges Foreign Private Banking Unit with Providing Unregistered Services to U.S. Clients

The SEC charged HSBC's Swiss-based private banking arm with violating federal securities laws by failing to register with the SEC before providing cross-border brokerage and investment advisory services to U.S. clients.

According to the SEC's order, HSBC Private Bank personnel traveled to the United States on at least 40 occasions to solicit clients, provide investment advice and induce securities transactions; however, these relationship managers were not registered to provide such services, nor were they affiliated with a registered investment adviser or broker-dealer. The SEC also found that the relationship managers communicated directly with clients in the United States by overseas mail and e-mail.

See: SEC Order; SEC Press Release.