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Pakistan's Top Bank to Pay $225 Million, End U.S. Operations

  • Habib Bank to surrender license in settlement with New York
  • Terrorist, arms dealer were on bank ‘good guy’ list, DFS says
A Habib Bank Limited bank branch in Pakistan's port city of Karachi.

A Habib Bank Limited bank branch in Pakistan's port city of Karachi.

Photographer: Asif Hassan/AFP via Getty Images
Updated on

New York’s banking regulator ordered Habib Bank Ltd. to pay $225 million and surrender its license to operate in the state, effectively removing Pakistan’s largest lender from the U.S. financial system.

Managers in Habib’s branch office in Manhattan failed for more than a decade to shore up weak anti-money-laundering controls and sanctions compliance, New York’s Department of Financial Services said in orders issued Thursday. The bank put through thousands of poorly screened transactions, the DFS said, including for people on a “good guy” list at the bank that included an identified terrorist, an international arms dealer and an Iranian oil shipper.