US authorities fined $55m to NBP
US authorities have fined $55 million to the National Bank of Pakistan (NBP) New York branch.
The fines were imposed on Thursday by the US Federal Reserve and Adrian A. Harris, New York State’s superintendent of financial services.
The US Federal Reserve on March 4, 2021, in a joint inspection of the New York State Department of Financial Services, found “significant breaches of risk management and compliance with federal laws, rules and regulations.” And imposed a fine of 20.4 million dollars.
In the order, the Federal Reserve also clarified that the flaws were related to compliance with the Anti-Money Laundering (AML) and the US Bank Secrecy Act (BSA).
The order states that the NBP entered into a “written agreement” with the authorities on March 16, 2016 to address the “deficiencies”.
The order said a recent inspection found that the NBP had “failed to fully comply with every clause of the written agreement”.
Under the action, the US Federal Reserve has ordered the NBP to take “positive action” on “corporate governance and administrative operations”.
The Federal Reserve has directed the NBP to implement the recommendations within 60 days of the order. The US Federal Reserve has also asked the NBP to nominate an officer within 10 days.
Adrian A. Harris, New York State Superintendent of Financial Services, announced that the NBP had agreed to pay $35m for compliance deficiencies at its New York branch.
Superintendent Harris said, “The National Bank of Pakistan has allowed serious compliance shortcomings in its New York branch to persist for years despite repeated regulatory warnings.”