New York State Banking Regulator fined Pakistan’s Habib Bank and Kicked out of US
New York’s state banking regulator has slapped a $225m fine on Habib Bank, the biggest bank in Pakistan, and ordered it out of the US after finding a catalogue of flaws in compliance that “opened the door” to the financing of terror.
The Department of Financial Services on Thursday said it was taking drastic action — the first time it has ordered a bank to shut down in the US — because Habib had failed to correct serious weaknesses first identified more than a decade ago.
By 2015, the DFS found, the bank’s compliance function was in an even worse state, lacking the most basic of controls on money-laundering and customer screening. The DFS’ most recent investigation found that Habib facilitated billions of dollars in transactions with a Saudi private bank, the Al Rajhi Bank, which has had...