Recorded RBI impact
Fine: Rs 5.00 L
Monetary penalty · Fresh imposition
Published by RBI
5 Dec 2013
Case Brief
The Reserve Bank of India imposed a monetary penalty of Rs 5.00 lakh on The Coimbatore District Central Co-operative Bank Ltd., Tamil Nadu under Section 47(A)(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (as applicable to co-operative societies). RBI said the bank had failed to comply with Know Your Customer (KYC) norms and Anti-Money Laundering (AML) guidelines. After issuing a show-cause notice and considering the bank's written reply and personal submissions, RBI concluded that the violation was substantiated and merited penalty.
Why RBI Acted
The Reserve Bank of India imposed a monetary penalty under Section 47(A)(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (as applicable to co-operative societies). The bank was found to have violated Know Your Customer (KYC) norms and Anti-Money Laundering (AML) guidelines; RBI had issued a show-cause notice, considered the bank's written reply and personal submissions, and concluded that the violation was substantiated and warranted penalty.
Operating Impact
The bank must absorb the financial penalty and face supervisory censure for KYC/AML non-compliance. The action does not indicate a broader operating restriction, but it signals heightened compliance expectations for customer due diligence and anti-money-laundering controls.
Regulatory Basis
- Section 47(A)(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