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| Obama aide dupes HSBC of $75 million, claims bank |
| Bloomberg / New York Sep 20, 2009, 00:58 IST |
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HSBC Holdings Plc said it is a victim of a $75 million fraud by Hassan Nemazee, a top fundraiser for President Barack Obama and Hillary Clinton who was arrested last month for defrauding Citigroup Inc.
The US unit of HSBC, the world’s third-largest bank by market value, filed a $75 million fraud lawsuit against Nemazee in New York State Supreme Court in Manhattan. The September 2 suit came a week after Nemazee was arrested by the Federal Bureau of Investigation for cheating Citigroup out of $74 million.
According to US prosecutors, Nemazee, 59, repaid $74 million he stole from Citigroup by tricking another bank to lend him the money on August 24. That came a day after Nemazee was questioned by the FBI about the alleged Citigroup scam and the day before he was arrested. Prosecutors didn’t identify the second bank in an account that corresponds to the allegations in the complaint by HSBC Bank USA.
“On August 24, Nemazee drew down $75 million of his available $100 million in credit from HSBC,” the London-based bank said in its fraud and breach-of-contract complaint.
“Later that day, Citibank, which sometime prior to August 23, 2009, began to cooperate with federal law enforcement officials concerning Nemazee’s activities, accepted a wire transfer from Nemazee repaying Nemazee’s loan to Citibank, which at that time amounted to more than $74 million.”
Juanita Gutierrez, an HSBC spokeswoman, confirmed in an e-mail on Friday that the bank sued Nemazee. She declined to comment on whether the bank is the same one identified in court papers by prosecutors.
Yusill Scribner, a spokeswoman for US Attorney Preet Bharara in Manhattan, declined to comment.
House arrest
Nemazee, the chairman of Nemazee Capital Corp, is under house arrest in his $20 million Manhattan apartment on a $25 million bond. He hasn’t entered a formal response to the criminal charges. His lawyer, Paul Shechtman, didn’t immediately return a call seeking comment on Friday.
The financier was one of the leading fundraisers for the Democratic Party. In the 2008 presidential campaign, Nemazee raised at least $100,000 for Clinton, according to the Washington watchdog group Public Citizen. Nemazee brought in at least $500,000 for Obama after he defeated Clinton in the primary campaign, according to Public Citizen. Clinton is now secretary of state.
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