Dubai-based Mashreq Bank has agreed to pay a $40 million settlement to New York financial regulators, who accused the bank of cleaning millions of high-risk transactions without proper safeguards against money laundering and terrorist financing.
In a statement, Maria Vullo, superintendent of the New York Department of Financial Services (DFS) said that the bank “failed to fully comply with critical New York and federal banking laws aimed at combating international money laundering, terrorist financing and other related threats.”
The statement added that Mashreq’s branch in New York processed a total of $717 billion worth of transactions for customers in “high-risk” jurisdictions.
Reviews carried out by the DFS in 2016 and 2017 highlighted what American authorities said were deficiencies in its policies, including a failure to adequately demonstrate how staff members determined which transactions were acceptable.
“Mashreqbank takes pride in having been present in New York for almost 30 years and in its substantial and continuing efforts to work alongside regulators in strengthening its compliance programs,” the bank said in a statement.
The statement added that Mashreq “is devoting substantial financial and corporate resources to enhancing the compliance function at the New York Branch, and in building an effective and sustainable BSA/AML (bank secret act/anti-money laundering) and sanctions compliance infrastructure.”
“Mashreqbank remains committed to providing its customers with superior and robust banking services while maintaining and enhancing its compliance with regulatory expectations," the statement added.For all the latest banking and finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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