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Bad HSBC

$765m US penalty over pre-crisis mortgage-backed securities

The US government alleged HSBC misrepresented the quality of residential mortgage-backed securities it sold from 2005 to 2007. HSBC paid a $765m civil penalty.

$765m

Settled

On 9 October 2018 the US Attorney’s Office for the District of Colorado announced HSBC would pay a $765 million civil penalty over its sale of residential mortgage-backed securities (RMBS) from 2005 to 2007, before the financial crisis.

The government alleged HSBC misrepresented the quality of the loans behind the securities and its due-diligence procedures. HSBC first disclosed an agreement in principle in August 2018.

HSBC’s position

HSBC settled without admitting liability and said it had fully reserved for the amount.

The evidence

2 sources
  1. Exhibit AHSBC Agrees to Pay $765 Million in Connection with Its Sale of Residential Mortgage Backed SecuritiesUS Department of Justice · 9 October 2018 · justice.govOfficial record
  2. Exhibit BHSBC agrees to $765 million settlement with DOJ over pre-crisis mortgagesHousingWire · August 2018 · housingwire.com

Last checked 2 November 2026. Something wrong or out of date? Tell us and we’ll correct it.

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