*ISLAMABAD – **State Bank of Pakistan imposed heavy penalties upon fivePakistani Banks.*
*The State Bank of Pakistan (SBP) has imposed monetary fines amounting toRs219.058 million on five banks in December for violation in the area ofCustomer Due Diligence (CDD) and Know Your Customer (KYC) and ForeignExchange (FX) operations.*
As per the central bank, Bank Alfalah Limited faced the highest penalty ofRs96.095mn for Procedural Violations in the area of KYC/CFT. In addition topenal action, the bank has been advised to conduct an internal inquiry oncertain breaches/violation of regulatory requirements. Further, the bankhas been advised to strengthen its process related to KYC/CDD, in order toavoid recurrence of such violations in future.
Meanwhile, MCB Bank Ltd faced the monetary penalty of Rs49.499mn forProcedural Violations in the area of FX operations. The monetary penaltywas imposed on deficiencies in the area of foreign trade operations.
Habib Metropolitan Bank Ltd faced Rs34.578mn in penalty for ProceduralViolations in the area of CDD/KYC.
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In addition to penal action, the bank has been advised timelines to bringimprovements in its systems/controls to avoid recurrence of such violationsin future, said SBP.
It may be mentioned that SBP takes supervisory enforcement actions againstthose financial institutions that fail to comply with legal or regulatoryrequirements and these actions may range from imposition of penalties,administrative & financial sanctions and reference to concerned lawenforcement/ prosecution agencies.
