There was more humiliation for British banks yesterday when HSBC's head of compliance David Bagley felt compelled to resign in front of a committee of American politicians who had accused the bank of allowing clients linked to Mexican drug gangs, al-Qaeda and rogue regimes such as Iran, North Korea and Burma to move money around the world with little or no scrutiny.

David Jackman, the former head of ethics at the Financial Services Authority, says there was "the nod and the wink" and the "systemic culture that allowed these things to become the norm."

Speaking to the Today programme he said the scandal reflects the "exotic end" of primarily middle-management who are very driven to produce returns and have "assumptions that this sort of crime is victimless", something that was not being challenged, he explains.

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