The U. S. has slapped British banking giant HSBC with a hefty fine of $1.9 billion for violating anti-money laundering (AML) norms.

On Tuesday, the U. S. Treasury Department said that the bank was found guilty of failing to comply with AML norms, which facilitated several million dollars from Mexican drug trafficking organizations to flow through accounts in the U. S.

David S Cohen, Under Secretary for Terrorism & Financial Intelligence, said in the statement that HSBC willfully left dangerous gaps in its financial system that were abused by international drug dealers and other criminals.

Cohen said in a statement, "HSBC absolutely knew the risks of the business it pursued, yet it ignored specific, obvious warnings. Its failures allowed hundreds of millions of dollars in drug money to pass through its unattended gates."

Cohen added that HSBC processed transactions through US financial institutions that involved a number of entities, individuals and countries like Iran, Libya, Sudan that were subject to U. S. sanctions.

The HSBC has agreed to pay the penalty, which is the biggest ever in the U. S. banking history. The banking giant also promised that it would take steps to further strengthen its compliance with the U. S. policies and procedures.