WASHINGTON: The Unites States (US) federal authorities have fined the National Bank of Pakistan (NBP), a foreign bank operating in the US, more than 55 million US dollars for anti-money laundering violations and for repeated compliance failures. The move comes in as a huge setback for Pakistan’s staggering economy. The penalty has been issued against NBP for anti-money laundering violations. NBP is a subsidiary of the State Bank of Pakistan.

The National Bank of Pakistan had allowed serious compliance deficiencies in its New York branch to persist for years despite repeated regulatory warnings. The US’ move to impose penalty will be a massive setback for Pakistan in the next Financial Action Task Force (FATF) meeting. Pakistan is currently in FATF’s grey list, for providing financial aid to terror activities. The current action against NBP has increased Pakistan’s chances of getting blacklisted. Pakistan has been in the FATF grey list since June 2018. This has adversely affected its economy and image globally.