Recorded RBI impact
Fine: Rs 1.00 L
Monetary penalty · Fresh imposition
Published by RBI
4 Feb 2011
Case Brief
The Reserve Bank of India imposed a monetary penalty of Rs 1 lakh on The Ghoghamba Vibhag Nagrik Sahakari Bank Ltd., Ghoghamba, Dist. Panchmahal under Section 47(A)(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (AACS). RBI said the bank violated instructions on persistence of irregularities from a previous inspection report and on reporting cash transactions exceeding Rs 10 lakh to FIU-IND under AML guidelines. After a show-cause process and review of the bank's reply, RBI concluded that the violations were substantiated and warranted the penalty.
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). The bank was found to have violated RBI instructions relating to the persistence of irregularities identified in a prior inspection report and the requirement to report cash transactions in excess of Rs 10 lakh to FIU-IND under AML guidelines. RBI issued a show-cause notice, considered the bank's written reply, and concluded the violations were substantiated.
Operating Impact
The bank must absorb the penalty and address the compliance failures cited by RBI, especially AML reporting controls and closure of irregularities identified in earlier inspections. The order has no stated operational restriction, but it signals heightened regulatory 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