Recorded RBI impact
Fine: Rs 1.00 L
Monetary penalty · Fresh imposition
Published by RBI
28 Mar 2011
Case Brief
The Reserve Bank of India imposed a monetary penalty of Rs 1.00 lakh on Shree Limbdi Nagrik Sahakari Bank Limited, Limbdi, Dist. Surendranagar, Gujarat. The penalty was levied under Section 47(A)(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (AACS) for non-implementation of KYC norms, non-submission of CTR/STR statements to FIU-IND, and persistence of irregularities flagged in a previous RBI inspection. RBI issued a show-cause notice, considered the bank's written reply and personal submissions, and concluded that the violations were substantiated.
Why RBI Acted
RBI imposed a monetary penalty under Section 47(A)(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (AACS) after finding that the bank had not implemented Know Your Customer (KYC) norms, had not submitted Cash Transaction Report (CTR) and Suspicious Transaction Report (STR) statements with FIU-IND, New Delhi, and had continued irregularities pointed out in an earlier RBI inspection. The bank received a show-cause notice, submitted a written reply, and made personal submissions, but RBI concluded the violations were substantiated and merited penalty.
Operating Impact
The bank must absorb the financial penalty; the release does not describe any further operational restriction or cancellation. The findings relate to compliance weaknesses in KYC/AML controls and statutory reporting to FIU-IND, which may remain relevant for future supervisory scrutiny.
Regulatory Basis
- Section 47(A)(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (AACS)
Action Facts
- Primary Impact
- Fine: Rs 1.00 L
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank