Baku, July 17 (AzerTAc). HSBC provided a conduit for "drug kingpins and rogue nations", according to a US senate committee investigating money laundering claims at the bank.
A Senate report said suspicious funds from countries including Mexico and Syria had passed through the bank.
HSBC is set to apologise for its wrong-doing. Its officials are giving their evidence at Tuesday's Senate hearing.
Senator Carl Levin said HSBC's lack of controls at its US and overseas units had been "a recipe for trouble".
Mr Levin is chairman of the Senate Permanent Subcommittee on Investigations, which is looking into HSBC's activities between 2006 and 2010.
The subcommittee, which began at 13:30GMT, heard first from David Cohen, Under Secretary for Terrorism and Financial Intelligence and Leigh Winchell, assistant director, of the customs enforcement unit ICE, which is part of Homeland Security.
In a statement, Europe's largest bank, said it expected to be held accountable for what went wrong.
"We will apologise, acknowledge these mistakes, answer for our actions and give our absolute commitment to fixing what went wrong," HSBC said in a statement released on Monday.
The Senate report said large sums of drug money from Mexico had almost certainly been laundered through the bank, as well as questionable funds from the Cayman Islands, Iran and Saudi Arabia.
Senator Carl Levin, chairman of the subcommittee that released the report, spoke of a "polluted" system that allowed black-market funds to move through the US banking system.
"In an age of international terrorism, drug violence in our streets and on our borders, and organised crime, stopping illicit money flows that support those atrocities is a national security imperative," said Mr Levin.
The report also concludes that the US bank regulator, the Office of the Comptroller of the Currency, failed to properly monitor HSBC.
The report comes at a difficult time for the British banking sector, which is having its standards and practices scrutinised by regulators and policymakers.
Critics say the current furore over the manipulation of the Libor inter-bank interest rate is the latest example of a banking system in need of fundamental reform.
According to the Senate committee, HSBC accepted more than $15 billion in cash from subsidiaries in Mexico, Russia and other countries at high risk of money laundering but failed to conduct any monitoring of these bulk cash transactions between mid-2006 and mid-2009.
Furthermore, the report found that HSBC knew of lax anti-money laundering practices at its Mexican subsidiary HBMX, which had dated back to its purchase in 2002.
HBMX was warned, on at least two occasions, by Mexican authorities that drug money was probably being laundered through HBMX accounts.
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