HSBC and StanChart subject to probe into SA corruption

The Treasury has ordered the Financial Conduct Authority and the Serious Fraud Office to investigate whether HSBC and Standard Chartered are exposed to a corruption scandal in South Africa.

Labour peer Lord Peter Hain recently raised concerns that the two banks may have been used to launder money in the scandal around the Gupta family.

The family, associates of South African president Jacob Zuma, have been accused of illegally influencing government contracts.

Hain wrote to Chancellor Philip Hammond to raise the concerns, who in turn passed the matter to the FCA for an investigation.

A spokesperson for the Treasury said: "We take allegations of financial misconduct very seriously, and have passed Lord Hain's letter on to the Financial Conduct Authority and relevant UK law enforcement agencies, including the National Crime Agency and Serious Fraud Office, to agree the right action."

Hain's letter last month to Hammond said: "It will be no secret to financial crime experts that criminals target large and credible financial institutions for the same reasons that legitimate multi-national networks do - for their global reach.

"I have deep concerns and questions around the complicity, whether witting or unwitting, of U.K. global financial institutions in the Gupta/Zuma criminal network."

The corruption scandal involving the Guptas has enveloped vast swathes of powerful groups in South Africa, as President Zuma and the family deny any wrongdoing.

However, reports suggest the Guptas have exchanged money for influence in Zuma’s government.

Auditing firm KPMG recently sacked its top brass within the country as a result of the scandal, while UK PR firm Bell Pottinger was forced into administration following the loss of business off the back of its involvement.