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The report said that HSBC accepted more than $15bn in cash between 2006 and 2009 from Mexico, Russia and other countries at high risk of money-laundering but failed properly to monitor transactions. The bank even managed to label Mexico, ravaged by corruption and drug wars, as “low risk”, the committee said. HSBC also provided US dollars and banking services to banks in Saudi Arabia and Bangladesh despite apparent links to terrorist financing, according to the report.

David Bagley, HSBC’s global head of compliance who had worked at the bank for 20 years, today resigned from that job in front of the committee. Mr Bagley, who will stay with the bank, admitted HSBC had “fallen short of our own and regulators’ expectations”.

Senator Carl Levin, who led the committee’s investigation, said HSBC’s lack of controls in America and abroad between 2006 and 2010 had been “a recipe for trouble”.

The report said many of the abuses occurred as a result of HSBC’s failure to monitor its so-called “bearer share accounts”, facilities that legally keep secret the owners and some transactions. At one stage the Miami branch had 1,670 bearer share accounts, holding $2.6bn of assets and generating revenues of $26m. Mr Levin told the hearing: “In an age of international terrorism, drug violence in our streets and on our borders, and organised crime, stopping illicit money flows that support those atrocities is a national security imperative.”

The chairman accepted HSBC had overhauled its systems since the failures were found and was “committed to cleaning its house”.

The investigation into HSBC is the latest US attempt to crack down on money-laundering. Last month, ING agreed to pay $619m to settle allegations that it broke American sanctions against Cuba and Iran.