Senate panel accuses HSBC in money-laundering report Mon Jul 16, 2012 5:39pm EDT (Reuters) - HSBC Holdings Plc acted as financier to clients seeking to route shadowy funds from the world's most dangerous and secretive corners, including Mexico, Iran, the Cayman Islands, Saudi Arabia, and Syria, according to a scathing U.S. Senate report issued on Monday. While the big British bank's problems in stanching dirty money has been known for nearly a decade, the Senate probe detailed just how sweeping the problems have been at the bank as well as at the Office of the Comptroller of the Currency, a top U.S. bank regulator which the report said failed to properly monitor HSBC. The report comes at a troubling time for a banking industry reeling from a multi-country probe into the manipulation of global benchmark rates. Last month, rival British bank Barclays Plc agreed to pay a $453 million fine to settle a U.S.-U.K. probe into the rigging of the a key benchmark interest rate, the London interbank offered rate, or Libor. The HSBC report was issued by the U.S. Senate Permanent Subcommittee on Investigations, a Congressional watchdog that probes financial improprieties. The year-long inquiry, which included a review of 1.4 million documents and interviews with 75 HSBC officials and bank regulators, will be the focus of a hearing on Tuesday at which HSBC and OCC officials are scheduled to testify. Senator Carl Levin, chairman of the subcommittee, described a "polluted" system that allowed black-market funds to move through the U.S. banking system. Reporting by Carrick Mollenkamp; Editing by Alwyn Scott and Tim Dobbyn