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The National Bank of Pakistan (NBP), a foreign bank operating in the United States, was fined more than USD 55 million by US federal authorities for anti-money laundering offences and chronic compliance failures. The Federal Reserve Board (FRB) stated on Thursday that the National Bank of Pakistan will be fined USD 20.4 million for anti-money laundering offences.
“As described in the consent cease and desist order against the National Bank of Pakistan, the firm’s U.S. banking operations did not maintain an adequate risk management programme or controls sufficient to comply with anti-money laundering laws,” according to the Federal Government. The Feb Board’s action coincides with that of the New York State Department of Financial Services, according to the board.
The National Bank of Pakistan and its New York branch have agreed to pay USD 35 million in fines to the New York State Department of Financial Services, according to a Consent Order signed with them (NYDFS). According to a news release from the New York Department of Financial Services, “the Consent Order resolves the Department’s investigation into compliance deficiencies at the Branch with respect to Bank Secrecy Act/Anti-Money Laundering (“BSA/AML”) standards.”
Despite repeated regulatory warnings, the National Bank of Pakistan permitted major compliance issues in its New York office to persist for years, according to Superintendent Harris. “Foreign banks that operate in New York have an obligation to maintain adequate controls, and the Department will continue to encourage financial transparency and take action to protect the global financial system if those requirements aren’t satisfied,” she added.
