Recorded RBI impact
Fine: Rs 6.00 L
Monetary penalty · Fresh imposition
Published by RBI
18 Jul 2022
Case Brief
The Reserve Bank of India imposed a monetary penalty of Rs 6.00 lakh on Shri Chhatrapati Rajarshi Shahu Urban Co-operative Bank Limited, Beed, Maharashtra. RBI said the bank had delayed reporting of frauds to the regulator, which violated the directions issued to Urban Cooperative Banks on Frauds – Classification and Reporting. The penalty was imposed under Section 47A(1)(c) read with Section 46(4)(i) and Section 56 of the Banking Regulation Act, 1949, after RBI considered the bank's replies, oral submissions, and additional submissions and found the charge substantiated.
Why RBI Acted
RBI found that the bank had delayed reporting of frauds to RBI, contrary to the directions issued to Urban Cooperative Banks on Frauds – Classification and Reporting. After inspection, notice, replies, oral submissions, and additional submissions, RBI concluded the non-compliance was substantiated and imposed a monetary penalty under Section 47A(1)(c) read with Section 46(4)(i) and Section 56 of the Banking Regulation Act, 1949.
Operating Impact
The bank must bear the monetary penalty and remain compliant with RBI's fraud classification and reporting directions going forward. The action does not invalidate customer transactions, but it underscores the bank's obligation to report frauds within the prescribed timelines and avoid repeat regulatory breaches.
Regulatory Basis
- Section 47 A (1) (c) read with Section 46 (4) (i) and Section 56 of the Banking Regulation Act, 1949
Action Facts
- Primary Impact
- Fine: Rs 6.00 L
- Order Date
- 15 Jul 2022
- Effective From
- 15 Jul 2022
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank