Bangladesh government will pay £3.3m that the British regulator fined Sonali Bank in the United Kingdom for its failure to prevent money laundering, said Finance Minister AMA Muhith.
“We will have to pay the fine within the stipulated time. Sonali Bank already appealed to the UK’s Financial Conduct Authority (FCA), but failed to avoid the fine,” he told journalists in Dhaka on his return from abroad yesterday.
The UK operations of Bangladesh’s biggest bank, Sonali Bank have been banned from accepting deposits from any new customers for 24 weeks, reports BBC Online.
The bank’s top anti-money laundering official, Steven Smith, has been banned from any similar job in banking. But its main business, remitting cash to people in Bangladesh, is unaffected.
The FCA said the bank had failed to put anti-money laundering controls in place.
Bangladesh government has 51% ownership in the bank. An FCA investigation found that the bank’s failure to operate proper controls against potential money laundering had taken place despite previous warnings from the regulator as long ago as 2010.
“Sonali Bank failed to maintain adequate anti-money laundering (AML) systems between 20 August 2010 and 21 July 2014,” said the FCA regulator.
Sonali Bank currently has three UK branches – in London, Birmingham and Bradford – which are aimed at serving the expatriate Bangladeshi community.
When asked “How did it happen and who are responsible?”, Muhith replied: “We are taking care of it, and the board of the bank will decide actions in this regard.”
However, the confidential reports of the Bangladesh government during 2010-2014 period praised the UK operations of the Sonali Bank. The reports suggest that the government high-ups wanted to launch full operations of the bank in the UK.
Official sources claimed Bank and Financial Institutions Division has taken reform initiatives for Sonali Bank UK, which will be carried out till December.
Sonali Bank UK has weaknesses in its governance and assessment of wealth and money. The government plans to appoint efficient workforces and make guild-lines for the UK operations.
Officials said the steps will help the bank solve its existing problems.
According to the data, the FCA fined Berkeley Bank £72m, Lloyds Bank £117m, the Bank of New York £126m over the last three years and the total amount reached £2bn.
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