SBP slaps Rs465mln fines on 4 banks for AML noncompliance

KARACHI: State Bank of Pakistan (SBP) imposed Rs465 million penalties on four banks in Q3 of 2021 for noncompliance with instructions on anti-money laundering (AML) and combating the financing of terrorism, general banking operations, and customer due diligence, the SBP said on Friday.

The banks include: National Bank of Pakistan, Silk Bank Limited, United Bank Limited, and Industrial and Commercial Bank of China-Pakistan branches.

The penalty of Rs280.509 million was imposed on NBP followed by Silk Bank (Rs132.437 million), UBL (Rs38.554 million), and ICBC Pakistan branches (Rs13.542

million).

The banks were fined for violating regulations such as failure to carry out due diligence and know your customer and non-compliance with the AML rules. These banks were also failing to comply with the instructions related to foreign exchange and general banking

operations.

The SBP asked these banks to conduct an internal inquiry on breaches of regulatory instructions and take disciplinary action against the delinquent officials.

The July-September enforcement action taken by the regulator against the banks came after the Financial Action Task Force (FATF) retained Pakistan on its increased monitoring list or the grey list. Out of 27 points, the country has completed 26 targets of FATF.

Pakistan has remained on FATF’s grey list for deficiencies in its counter-terror finance and anti-money laundering regimes since June 2018.