HSBC loses senior anti-money laundering compliance executive

By Brett Wolf

Oct 11 (Reuters) - A senior player in HSBC's push to improvethe way it polices transactions for criminal activity left theBritish bank late last month, creating a possible gap inleadership as it seeks to satisfy compliance demands from U.S.regulators and the U.S. Department of Justice.

Daniel Wager, a former Homeland Security official with priorexperience helping another multinational bank improve compliancecontrols, left his post as regional head of anti-moneylaundering investigations last month to join a consultingventure. Thus far, a replacement has not been named, a sourcefamiliar with the matter said.

Wager was HSBC's top U.S. anti-money launderingexecutive until early this year when he was replaced by MarySquire, formerly head of sanctions and anti-money laundering atthe Royal Bank of Scotland Group.

Wager and Polly Greenberg, who last month also left her jobas chief of the major economic crime bureau at the ManhattanDistrict Attorney's office, started a New York regulatorycompliance practice for Kinetic Partners, a division offinancial advisory and investment banking firm Duff & PhelpsCorp.

HSBC spokesman Rob Sherman declined to comment on Wager'sdeparture.

HSBC paid nearly $2 billion in penalties in December 2012 toresolve charges that it failed to stop hundreds of millions ofdollars in drug money from flowing through the bank from Mexico,and it promised to fix the problems.

The Office of the Comptroller of the Currency (OCC) and theJustice Department are closely tracking the bank's steps.Spokesmen for both declined comment on Wager's departure.

The government chose former New York prosecutor MichaelCherkasky to monitor HSBC's compliance remediation efforts. Hisreports have cited issues with the bank's progress to date.

In April 2014, after reviewing a report by Cherkasky, theJustice Department said in a mandatory court filing in federalcourt in Brooklyn that there remains "much work to be done."

In a court filing earlier this month, the Justice Departmentsaid Cherkasky "continues to identify specific areas of HSBCGroup's AML and sanctions compliance program where furtherremediation is required."

It added that the bank "continues to work to address andremediate these areas." (Reporting by Brett Wolf in St. Louis; Editing by Tom Brown andGrant McCool)