Recorded RBI impact
Fine: Rs 5.00 L
Monetary penalty · Fresh imposition
Published by RBI
17 Jun 2015
Case Brief
The Reserve Bank of India imposed a monetary penalty of ₹5.00 lakh on The Junagadh Commercial Co-operative Bank Ltd., Junagadh (Gujarat). The penalty was imposed under Section 47A(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (as applicable to co-operative societies), after an inspection for the bank’s financial position as on March 31, 2013 found violations of RBI directives/guidelines on KYC norms, AML measures, CFT, and obligations under the Prevention of Money Laundering Act, 2002. RBI had issued a show-cause notice, considered the bank’s written reply and personal submissions, and concluded that the violations were 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 an inspection found the bank had violated RBI directives/guidelines relating to Know Your Customer (KYC) norms, Anti-Money Laundering (AML) measures, Combating of Financing of Terrorism (CFT), and obligations under the Prevention of Money Laundering Act (PMLA), 2002. The bank was issued a show-cause notice, submitted a written reply, and made personal submissions, but RBI concluded the violations were substantiated and warranted penalty.
Operating Impact
The bank must absorb the monetary penalty and continue complying with RBI’s KYC/AML/CFT and PMLA-related requirements going forward. No broader business restriction or license action is stated in this release, so the forward impact is limited to the fine and 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