The Observer carries a story this morning that HSBC and HBOS have both failed to comply with a very basic requirement of company law. As they note:

Two of Britain's biggest banks have failed to register the location of their subsidiaries in what appears to be a contravention of British company law.

Companies are required to disclose in annual reports, or annual returns, where subsidiaries are registered. But both HBOS and HSBC admit they have failed to comply with this requirement.

HBOS and HSBC claimed the matter was a result of a simple administrative error.

I agree with TUC boss Brendan Barber who told the Observer that he believes the "oversight" is part of a worrying trend in which banks that are now receiving hundreds of billions of pounds in treasury support have been using secretive tax havens for esoteric operations such as structured investment vehicles.

He's right.

But there's another point to make. Candidly I do not believe that HBOS made an innocent mistake. They did not file in 2006 or 2007 either. That's a systematic error: that suggests it is deliberate.

And now it's been rumbled HSBC might say that that was "a simple systems error, in the original filing" but let's be clear about this: it is one for which the directors are culpable. Why make it an offence if the directors of some of the largest companies in the UK are not prosecuted when they breach this requirement?

So my message is simple: get them in the dock, now. Make an example of the directors of these banks. Let's show we mean business when we demand compliance and transparency. Nothing less will do.

Disclosure: I am a consultant to the TUC. Opinions expressed are my own.