Case Brief
What Happened
The Reserve Bank of India imposed a monetary penalty of ₹15 lakh on Fedbank Financial Services Limited, Mumbai, by order dated March 22, 2021. The penalty was imposed because the company did not comply with certain provisions of the RBI's 'Monitoring of Frauds in NBFCs (Reserve Bank) Directions, 2016'. RBI said the non-compliance was identified during a statutory inspection with reference to the company's financial position as on March 31, 2019; after a show-cause notice, the company's reply, and oral submissions at a personal hearing, the charge was found substantiated. RBI clarified that the action was based on regulatory compliance deficiencies and did not pronounce on the validity of any transaction or agreement entered into by the company with its customers.