Recorded RBI impact
Fine: Rs 5.00 L
Monetary penalty · Fresh imposition
Published by RBI
14 Dec 2012
Case Brief
The Reserve Bank of India imposed a monetary penalty of Rs 5 lakh on Sri Potti Sri Ramulu Nellore District Co-operative Central Bank Ltd., Nellore, Andhra Pradesh, 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 penalty was for non-adherence to Know Your Customer (KYC) norms and Anti Money Laundering (AML) guidelines. The bank had received a show-cause notice, submitted a written reply, and made personal submissions, but RBI concluded that the violation was substantiated.
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 the bank had violated Know Your Customer (KYC) norms and Anti Money Laundering (AML) guidelines. The bank submitted a written reply to the show-cause notice and made personal submissions, but RBI found the violation substantiated and deserving of penalty.
Operating Impact
The bank must bear the financial penalty and any compliance follow-up implied by RBI’s finding. The order does not describe a business restriction, but it signals regulatory scrutiny over the bank’s KYC/AML controls and could affect future compliance expectations.
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 5.00 L
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank