Household HSBC Watch

The following is reprinted with permission. We thank Peter for keeping us updated. If you think you know your bank, or if you bank at HSBC you need to read this article. I personally think this is the business model HSBC Finance would adopt in the United States if it was legal. Joseph Salterio, manager of HSBC Panama could become the Chairman of HSBC USA perhaps? Here we go: Peter Gordon, a wealthy Canadian retiree, moved his money to a foundation and then the foundation opened accounts with HSBC bank Panama. However, Gordon was unhappy with the services of that bank, closed the accounts and wired the foundation’s funds to another Panamanian bank. He then posted a number of messages criticizing HSBC’s service and excessive fees on a Yahoo forum for expatriates in Panama.

These messages very much upset one Joseph Salterio, manager of HSBC Panama. Together with some friends, American dentist Charly Garcia (who is also president of the American Society), insurance broker Kevin Bradley (who sells health insurance to expatriates for an HSBC-owned company) and later retired air force man Donald Winner (who is now a PR man for underworld figures), a plan was hatched to get even and make some money in the process. HSBC Panama/USA sued Gordon for alleged damages for $5 million, and then proceeded to have all his assets in Panama sequestered. It made the front page in the local press.

In itself, the case wouldn’t be worth mentioning as it is typical for the wonderful Panamanian business and expat scene where this type of cloak and dagger, bickering and backstabbing is simply part of daily life. However, what makes it important is that not just Gordon’s assets were sequestered, but those of the supposedly “bullet proof” foundation as well. The foundation’s lawyers sought remedies in the courts, but now the Supreme Court has decided that indeed such foundations may be sequestered even when they have formally nothing to do with a person who is accused of libel.

This will have many consequences that the HSBC gang and the court haven’t thought of. Trust in Panama’s asset protection industry had already suffered from these antics and the Supreme Court decision will no doubt shy away more money being deposited in Panama; depositors look for privacy, not high profile court cases and frivolous asset seizures by rogue bankers.

(Quotes from and by Okke Ornstein - July 24, 2008 at 1:00 pm)