Pakistan’s largest bank has been forced to suspend its operations in the United States after New York state regulators said it “opened the door” to financing terrorism, according to financial news outlets.
According to the Times of India, New York’s Department of Financial Services said that in addition to shutting down the operations of Habib Bank, which has operated in the United States since 1978, it was fining the Pakistani multinational $225 million for repeated violations of state regulations on illicit transactions stretching back to 2007.
“DFS will not tolerate inadequate risk and compliance functions that open the door to the financing of terrorist activities that pose a grave threat to the people of this state and the financial system as a whole,” said Maria Vullo, superintendent of the Department of Financial Services, said in a statement.
“The bank has repeatedly been given more than sufficient opportunity to correct its glaring deficiencies, yet it has failed to do so. DFS will not stand by and let Habib Bank sneak out of the United States without holding it accountable for putting the integrity of the financial services industry and the safety of our nation at risk.”
The bank, which is the first institution forced to shutter its doors by New York state, has agreed to cease operations once its New York City operations are properly wound down.
The latest alleged violation by Habib — also known as HBL — involves its ties with Al Rajhi Bank, a private Saudi bank with links to Al Qaeda. A recent investigation showed that billions of dollars of transactions with the terrorist-affiliated bank were facilitated by Habib.
Investigators also found that another $250 million in transactions were waived through without scrutiny by putting the individuals involved on a so-called “good guy” list, which is supposed to indicate clients who represent a low risk for illicit activity.
And yet, after all that, Habib may have gotten off easy. As the Times of India notes, officials originally wanted to impose a $629.6 million fine on the bank. Back in August, Habib company secretary Nausheen Ahmad called the fine “capricious” and “outrageous.”
No, what’s outrageous is facilitating terrorist funding. That’s what Habib did, and America should be glad to be rid of them.
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