What happened: On Feb 24, after severe problems were discovered by US regulators, the National Bank of Pakistan agreed to pay Rs9.6 billion ($55.4 million) and give plans for enhancing compliance at its New York City branch. Details: The sanctions were imposed by the US Federal Reserve, the country’s central bank, and New York State Superintendent of Financial Services, Adrienne A Harris. US reserve’s penalty: The Federal Reserve, working with the New York State Department of Financial Services, levied a $20.4 million fine after finding “significant deficiencies” in the NBP branch’s “risk management and compliance with federal laws, rules, and regulations” during an examination on March 4, 2021. The reserve further indicated in the decision that the inadequacies were connected to anti-money laundering compliance and the US Bank Secrecy Act (BSA). New York’s penalty: Separately, the state of New York’s Superintendent of Financial Services, Adrienne A Harris, announced that NBP has agreed to pay $35 million for its New York branch’s compliance violations. “Foreign banks that operate in New York have an obligation to maintain adequate controls, and the Department will continue to encourage financial transparency and take action to protect the global financial system if those requirements aren’t satisfied,” Harris stated: What’s next: The bank has now been given 60 days from the date of the order to execute the reserve’s recommendations. It has also requested NBP to appoint an official within 10 days who will be “responsible for coordinating and submitting” written proposals to the Reserve Bank.