Recorded RBI impact
Fine: Rs 5.00 L
Monetary penalty · Fresh imposition
Published by RBI
16 Jun 2014
Case Brief
The Reserve Bank of India imposed a monetary penalty of Rs 5 lakh on Pithoragarh Jila Sahakari Bank Ltd., Pithoragarh, Uttarakhand under Section 47(A) read with Section 46 of the Banking Regulation Act, 1949 (as applicable to co-operative societies). RBI said the penalty was for non-adherence to Know Your Customer (KYC) norms and Anti Money Laundering (AML) guidelines. After issuing a show cause notice and considering the bank's written reply and personal submissions, RBI concluded that the violation was substantiated and warranted penalty.
Why RBI Acted
The Reserve Bank of India imposed a monetary penalty under Section 47(A) read with Section 46 of the Banking Regulation Act, 1949 (as applicable to co-operative societies), after finding that the bank had not adhered to Know Your Customer (KYC) norms and Anti Money Laundering (AML) guidelines. RBI issued a show cause notice, considered the bank's reply and personal submissions, and concluded that the violation was substantiated.
Operating Impact
The bank must absorb the monetary penalty; the action does not impose an operational restriction, but it signals regulatory non-compliance relating to customer due diligence and AML controls.
Regulatory Basis
- Section 47(A) read with Section 46 of the Banking Regulation Act, 1949 (As Applicable to Co-operative Societies)
Action Facts
- Primary Impact
- Fine: Rs 5.00 L
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank