UK minister questions when HSBC put tax scandal practices behind it

LONDON, Feb 10 (Reuters) - British Business Secretary Vince Cable has written to HSBC questioning how quickly its Swiss private banking arm stopped practices which may have helped customers avoid tax, saying he's troubled by claims they "may have continued much more recently".

Cable's intervention comes as HSBC Holdings Plc (HKSE: 0005.HK - news) faces investigation by U.S. authorities and an inquiry by British lawmakers after admitting failings by its Swiss private bank that may have allowed some customers to avoid taxes.

In a letter to Douglas Flint, HSBC's group chairman, Cable said he was "particularly troubled" by suggestions that some elements of the Swiss bank's "worst practices" may have continued longer than thought.

The bank says its Swiss arm had undergone a "radical transformation" in recent year.

But Sue Shelley, the sacked former head of compliance in Luxembourg at HSBC's private bank, has said she was pointing out compliance failures as recently as 2013, something she says she was fired for.

Cable told HSBC he was also concerned the allegations meant the bank may have flouted a taxation practice code which it signed up to in 2010.

"HSBC signed up to a code of practice on taxation in 2010, committing the bank to ending the use of tax planning schemes and following the spirit as well as the letter of tax law," Cable wrote.

"I am concerned that the more recent allegations, if proven, suggest that HSBC may not have adhered to that code, a matter I would take very seriously."

Cable said the scandal raised wider concerns about the way the bank treated whistle blowers and its overall culture and asked Flint to provide him with reassurance that the bank's employees could now raise concerns without fear and in the knowledge that they would be acted on.

(Reporting by Andrew Osborn; Editing by Susan Thomas)