KARACHI – State Bank of Pakistan has fined Muslim Commercial Bank MCB $23.554 million for failure to comply with its laws and regulations.
The Supervision Department of the Central Bank imposed heavy fines on MCB and some other commercial banks for violating the rules and regulations.
MCB and other banks were found guilty of breaching the standards of Know Your Customer (KYC), and general banking operations, as SBP introduced stern rules.
SBP mentioned that fines on MCB and other banks were based on deficiencies in compliance with regulatory instructions and did not reflect the financial soundness of the entities.
In October 2022, a penalty of Rs19.223 million was imposed on MCB Bank for violating regulations related to customer due diligence and know your customer, foreign exchange trading, asset quality, and general banking operations, per SBP data.
Previously, MCB faced the second-highest fine of Rs49.499 million for violations in foreign exchange (FX) operations in 2020.
Furthermore, State Bank of Pakistan (SBP) slapped penalties of over Rs465 million on 10 commercial banks over deficiencies in the compliance of regulatory instructions.
This is not the first time when MCB faced action as earlier President of Pakistan directed MCB to return money to bank fraud victims.
The bank was told to probe and to start criminal proceedings, including the registration of case, against corrupt officials. MCB filed appeal against the decision of the Banking Mohtasib directing the bank to pay the complainant a sum of Rs3.093 million.
It was learnt that MCB officials were involved in the scam with complainant Muhammad Munir Ahmed who was swindled Rs3.09 Million.
MCB violated the procedures by not complying with the own SOPs, introducing on its own a new system of signing deposit slips, affixing the Utility Bills Received stamp without receiving cash as well as collecting cash from customers from their business places.
