US orders Pakistan's largest private bank to close NY operations
After functioning for 40 years, the New York branch of Pakistan's Habib Bank has been ordered shut by US regulators after repeated warnings on possible terror funding and money laundering. A fine of $225mn has also been slapped. According to officials, Habib, Pakistan's biggest private bank, has been asked several times to watch out for suspicious transactions that could be related to illicit purposes.
Habib had repeatedly been warned over suspicious transactions
Habib has been functioning in the US since 1978. Throughout the years, it has approved large transactions by a known terrorist and an international arms dealer and improperly used a "good guy" list to clear transactions worth over $250mn. It allowed transactions of billions of dollars with Saudi's al Qaeda-linked Al Rajhi Bank. At least 13,000 dealings weren't adequately screened.
'Won't let Habib sneak out of the US'
The Department of Financial Services earlier proposed penalties of $629.6mn, an amount termed "outrageous" by Habib's company secretary Nausheen Ahmad. It was later reduced to $225mn. The bank will close down its NY branch "in an orderly manner", Ahmad said. But the DFS says it will have to surrender its license after it meets requirements. "DFS won't let Habib sneak out of the US."