Recorded RBI impact
Fine: Rs 2.00 L
Monetary penalty · Fresh imposition
Published by RBI
29 Apr 2024
Case Brief
By an order dated April 16, 2024, RBI imposed a monetary penalty of ₹2.00 lakh on The Central Co-operative Bank Limited, Bikaner, Rajasthan. The penalty was imposed for non-compliance with NABARD directions on 'Frauds - Guidelines for Classification, Reporting and Monitoring', after NABARD’s statutory inspection and subsequent supervisory findings indicated delay in reporting of frauds. RBI issued a show-cause notice, considered the bank’s reply and oral submissions, and then found the charge sustained under the Banking Regulation Act, 1949.
Why RBI Acted
NABARD’s statutory inspection found supervisory non-compliance with directions on 'Frauds - Guidelines for Classification, Reporting and Monitoring'. After a show-cause notice and personal hearing, RBI concluded that the charge of delay in reporting of frauds was sustained and imposed a monetary penalty under section 47A(1)(c) read with sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.
Operating Impact
The bank must bear the monetary penalty, but the release does not impose any deposit, lending, or operational restriction. The action signals regulatory non-compliance and may leave the bank exposed to any further RBI action, but it does not by itself affect customers’ access to banking services.
Regulatory Basis
- section 47 A(1)(c) read with sections 46(4)(i) and 56 of the Banking Regulation Act, 1949
Action Facts
- Primary Impact
- Fine: Rs 2.00 L
- Order Date
- 16 Apr 2024
- Effective From
- 16 Apr 2024
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank