NRB warns BFIs’ executives of dismissal for overlooking money laundering issues

KATHMANDU, Oct 3: Nepal Rastra Bank (NRB) has cautioned executive officers of banks and financial institutions (BFIs) not to overlook the issues related to money laundering taking place in their organizations.

Amending the unified directives on Tuesday, the central bank announced that the executives of the BFIs who will not take immediate actions against their officials found involved in breaching the money laundering prevention laws will face action. 

“The officials concerned and directors of the reporting BFIs could face a cash fine between Rs 1 million to Rs 50 million or dismissal from their jobs or both,” reads the NRB directive.  

The NRB has made the BFIs mandatory to abide by the laws related to tightening money laundering measures. The central bank in this regard has also set up a separate unit named ‘Money Laundering Prevention Supervision Division’ to look after the cases of money laundering.

Amid rising cases of suspicious transactions taking place in the BFIs, the NRB has come up with strict measures against high ranking officials of BFIs concerned. According to the NRB’s Financial Information Unit, it recorded 6,255 such transactions worth around Rs 40 billion in 2023, a surge by 57 percent. In 2021, cases related to suspicious transactions surged 68 percent while in 2022, the number was more than double at 3,979.  

By amending the unified directives, the NRB has asked the BFIs to conduct assessment of risks related to anti-money laundering, while revising the risk-based annual work plans within the first quarter of every fiscal year. The NRB has given the due date of 15 days after the end of the stipulated time asking the BFIs to report its ‘Money Laundering Prevention Supervision Division’ about the process of the risk assessment system they have adopted.