Case Brief
What Happened
The Reserve Bank of India imposed a monetary penalty of ₹10.00 lakh on The Co-operative Bank of Rajkot Ltd., Rajkot (Gujarat), for contravention of RBI directions relating to reporting of unauthorised transactions by customers to banks, use of the bank’s registered name in public communications, and fraud reporting/monitoring in urban co-operative banks. RBI said its inspection, with reference to the bank’s financial position as on March 31, 2022, found that the bank had not provided a direct link and 24x7 complaint/reporting options for unauthorised electronic transactions or loss/theft of payment instruments, had not enabled instant reply to SMS/email alerts, had used an abridged name without properly displaying the full licensed name in social media posts, and had failed to report a fraud case within the prescribed timeline. After a show-cause notice and consideration of the bank’s reply and personal hearing submissions, RBI concluded the charges were substantiated and warranted the penalty. RBI also clarified that the action was based on regulatory-compliance deficiencies and not meant to pronounce on the validity of any transaction or agreement with customers.