UAE bank fined $100m in US probe into Sudan sanctions violations

Washington — United Arab Emirates (UAE) bank Mashreqbank  has agreed to pay $100m in penalties to resolve a US government probe into violations of sanctions against doing business with Sudan, regulators said on Tuesday.

Between January 2005 and February 2009, Mashreq sent $4bn worth of Sudan-related payments through financial institutions in the US, violating US sanctions against Sudan, according to statements from the New York state department of financial services and the US treasury department. From 2009 through 2014, the bank's New York branch processed another $2.5m in prohibited payments, the department said.

The investigation found the bank instructed its employees to avoid disclosing certain information sent between banks to conceal the violations and avoid triggering alerts or freezes on the transactions, the department said.

Mashreq said in an emailed statement the bank stopped the conduct “of its own volition” and had dedicated “significant resources” to boosting compliance policies and procedures. The treasury department’s Office of Foreign Assets Control said the bank had provided “substantial co-operation” throughout the course of the investigation.

The Federal Reserve Board said in a separate statement it has issued a cease-and-desist order against the bank for having insufficient policies and procedures to ensure compliance with US sanctions laws.

The US imposed the sanctions in 1997 after Sudan was designated a state sponsor of terrorism, prohibiting financial institutions from conducting business with the government and some designated individuals and companies.

Mashreq also agreed to report on the status and sustainability of the bank's compliance programme.

Reuters