Recorded RBI impact
Fine: Rs 2.00 L
Monetary penalty · Fresh imposition
Published by RBI
26 Sept 2016
Case Brief
The Reserve Bank of India imposed a monetary penalty of ₹2.00 lakh on Shivam Sahakari Bank Limited, Kolhapur under Section 47A(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (as applicable to co-operative societies). RBI said the bank violated its instructions/guidelines relating to Area of Operation and Know Your Customer (KYC)/Anti-Money Laundering (AML). After issuing a show cause notice and considering the bank's written and oral submissions, RBI concluded that the violations were substantiated and merited penalty.
Why RBI Acted
RBI imposed a monetary penalty under Section 47A(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (as applicable to co-operative societies) after concluding that Shivam Sahakari Bank Limited, Kolhapur had violated RBI instructions/guidelines on Area of Operation and Know Your Customer (KYC)/Anti-Money Laundering (AML). The bank had responded to the show cause notice with written and oral submissions, but RBI found the violations substantiated and warranting penalty.
Operating Impact
The bank must absorb the financial penalty; the release does not indicate any additional operating restriction or licence action. The immediate forward-looking impact is limited to payment of the fine and compliance attention on area-of-operation and KYC/AML requirements.
Regulatory Basis
- Section 47A(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (As applicable to Co-operative Societies)
Action Facts
- Primary Impact
- Fine: Rs 2.00 L
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank