The Nepal Rastra Bank (NRB) has taken action against five commercial banks for non-compliance with rules and directives related to anti-money laundering (AML). The central bank has slapped a fine of Rs 5 million each on four commercial banks while warning a commercial bank. NRB has taken enforcement action against nine commercial banks till the second quarter of the current fiscal year. Of them, Prabhu Bank, Kumari Bank, Bank of Kathmandu (BOK) (now merged with Global IME Bank) and Prime Commercial Bank have been fined Rs 5 million each for violating the law related to money laundering.

According to the NRB, Nabil Bank has been cautioned after it was found that the bank failed to implement provisions related to know-your-customer (KYC).

NRB Executive Director Dev Kumar Dhakal said that fines have been slapped so that they correct their ways in the coming days. "The four banks have been fined and one bank has been cautioned for their non-compliance to the directives issued by the central bank," said Dhakal. According to NRB sources, actions were taken against these four banks after they did not follow the central bank order to freeze the bank account of Prithvi Bahadur Shah who attempted to bring undisclosed funds earned from criminal activities abroad. Citing some suspicious activities, the central bank had frozen Rs 400 million Shah brought from the US as per the request of a US government agency. Stating that the money sent in the name of Shah was illegally earned, the Financial Crimes Enforcement Network (FinCEN), a US government agency under the Department of Treasury, had asked the Financial Information Unit (FIU) of the NRB to freeze the amount and return it to the US. FinCEN collects and analyses information about financial transactions in order to combat domestic and international money laundering, terrorist financing, and other financial crimes. The Central Investigation Bureau (CIB) of Nepal Police arrested Shah and five others on January 7 on a charge of defrauding millions of dollars through unauthorized entry into the computer systems of foreign nationals. Similarly, NRB has cautioned the CEO of Machhapuchhre Bank for not reporting the correct details of the capital fund according to the capital adequacy framework. Likewise, the central bank has also cautioned Sanima Bank for providing additional facilities to the then CEO Bhuvan Dahal contrary to the provisions of the Bank and Financial Institution Act 2073. The central bank has also cautioned CEOs of Machhapuchhre Bank, Civil Bank and Nepal Investment Bank (now Nepal Investment Mega Bank), on the charge of collecting more interest from borrowers by increasing premiums contrary to the instructions of the regulatory body.