THE BIG SQUEEZE —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 $225 million has also been slapped on the Bank.
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 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 $250 million.
It allowed transactions of billions of dollars with Saudi’s al Qaeda-linked Al Rajhi Bank.
At least 13,000 dealings were inadequately screened.
The Department of Financial Services earlier proposed penalties of $629.6 million, an amount termed “outrageous” by Habib’s company secretary Nausheen Ahmad. It was later reduced to $225 million.
The bank will close down its NY branch “in an orderly manner”, Ahmad said.
The Department of Financial Services says the Bank will have to surrender its license after it meets requirements. “DFS won’t let Habib sneak out of the US.”
Writing on Twitter, Michael Kugelman claimed that the closure of the bank and fine, which is the largest ever imposed upon a Pakistani bank is perhaps an early indication of Washington’s latest policies aimed at pressurizing Pakistan to give up its alleged support and shelter to terrorists.
On August 21, in a speech announcing the US strategy in Afghanistan and South Asia under President Trump — he singled out Pakistan in particular for financing and providing a safe-haven for terrorism.
A day later, US Secretary of State Rex Tillerson told reporters that Washington would consider cutting aid to Pakistan, increasing the use of drone attacks within its territory and stripping the South Asian country of its status as a major non-NATO US ally. US General Nicholson said Afghan Taliban leaders were being given sanctuary in the Pakistani cities of Quetta and Peshawar.
The “squeeze” is on.