Fed calls on the United Bank to strengthen money laundering policies

Washington: The Federal Reserve Bank of New York (FRBNY) on Thursday ordered United Bank Limited to strengthen its anti-money laundering policies, the regulator accusing him of not doing enough to track suspicious transactions. This is the second time that the FRBNY has sanctioned UBL in recent years

In 2013, the Fed ordered United Bank to closely monitor remittances from New York to Karachi and blamed anti-money laundering form the bank. In a notification sent to the Pakistan Stock Exchange (PSX) Friday United Bank Limited (UBL) said that "United Bank Limited (UBL) and its New York branch have entered into a written agreement (WA 2018) with the Federal Reserve Bank of New York (FRBNY), effective July 2, 2018, upon the termination of the first written agreement dated October 28, 2013 (WA 2013), which primarily related to the international wire transfer services of the New York branch. "

"The WA 2018 compels UBL to take steps to strengthen its Bank Secrecy Act and its programs of surveillance, customer control and surveillance of suspicious activity

although it does not require any action. imposes no civil sanction on UBL, the disclosure regarding the signing of WA 2018 is being made as an update of the written agreement previously signed on October 28, 2013 (WA 2013), "read the notification.

In addition, UBL stated that it was taking all steps to strengthen its compliance framework to fully comply with WA 2018

As stated in WA 2018, the common goal of the FRBNY, UBL and the New York branch is that the New York branch operates in accordance with all applicable federal and state laws, rules and regulations. ] The Federal Reserve Bank of New York's notice issued on July 12 indicates that the most recent review of UBL's New York branch identified deficiencies related to risk management. NYC branch of UBL. t compliance with applicable federal and state anti-money laundering (AML) laws, rules and regulations.

The notification added "On June 28, 2018, the Board of Directors of the Bank, passed a resolution authorizing Mrs. Sima Kamil and Mr. Azeem ur Rahim to conclude this written agreement on behalf of the bank and the bank, and agreeing to the bank's compliance with all the terms of this agreement.In addition, the agreement between UBL and the Federal Reserve Bank of New York, the board of directors of the bank and the branch management would jointly submit a written plan within sixty days to increase oversight.

UBL branch management in New York would be responsible for ensuring compliance with the counter-regulatory requirements. Money laundering and regulations issued by the US Foreign Office's Deparment Office Depar The written plan should provide for "a sustainable governance framework that, at a minimum, addresses, considers and includes: (a) me that the board of directors will take to maintain effective control and oversight of the compliance of the executive management with the requirements of the BSA / AML and the OFAC regulations; 3 b) Measures to improve the management information systems indicating the compliance of Management with the requirements of the BSA / AML and FOCA regulations to senior management of the Bank and the General Management ; (c) measures to ensure that BSA / AML issues and OFAC regulations are properly tracked, escalated and reviewed by branch management. "

To ensure anti-money laundering compliance, the UBL branch within thirty days of this agreement Obligation to retain an acceptable third party to the Reserve Bank to conduct a full review of its compliance with BSA / AML (the "Compliance Review"), and prepare a written report of the findings, conclusions and recommendations in compliance

Within 10 days of the independent third party's engagement, but before the compliance audit, UBL and its subsidiary will jointly submit to the FRBNY for approval a letter of engagement that provides, at a minimum, for the independent third party to conduct a full evaluation of BSA's compliance program, policies and procedures. / AML.

And the compliance review should be concluded within 60 days of the approval of the engagement letter by the Reserve Bank.

"In addition, the FRBNY should receive a copy of the compliance report at the same time the report is submitted to the bank and branch; is committed to making all interim reports, drafts, working papers and other documents related to the compliance audit available to him on request, "states the notification.

UBL shares traded at Rs158.50, up Rs5. 93 (+ 3.89%) in the first half hour of trading at the PSX. The KSE-100 index traded at 40,360.73 points, up 485.61 points (+ 1.22%) at the time of filing this report.