Bank Agreement Targets Money Launderers

Dec. 21, 2006
By JEANNINE AVERSA AP Economics Writer

WASHINGTON — Banking regulators announced an agreement Thursday with a Pakistani-based bank to bolster policies aimed at detecting abuse by money launderers, terrorist financiers and other criminals.

The action announced by the Federal Reserve Board and the New York State Banking Department is against Habib Bank Limited of Karachi, Pakistan, and targets deficiencies at the financial institution's New York branch.

Regulators said the bank agreed to take steps to address compliance problems in its anti-money laundering policies.

Among other things, the agreement calls on the bank to improve its internal controls to detect abuses by money launderers and others. The bank also must set up a program to make sure that suspicious financial transactions are reported in a timely manner. It also must do a better job of verifying the identification of their customers. Employees also must be trained to help them detect abuses of the bank's services.

The agreement comes just days after banking regulators ordered the Bank of Tokyo-Mitsubishi UFJ to beef up its anti-money laundering policies.

Separately, banking authorities on Thursday announced that financial institutions will soon have a new format by which to report suspicious transactions to the government.

The change is meant to reduce the number of duplicate suspicious activity reports filed for the same transaction, the authorities said.

The change was announced jointly by the Financial Crimes Enforcement Network, the Federal Reserve, the Office of the Comptroller of the Currency, the Office of Thrift Supervision, the Federal Deposit Insurance Corp. and the National Credit Union Administration.

http://www.chron.com/disp/story.mpl/ap/fn/4418298.html