Recorded RBI impact
Fine: Rs 5.00 L
Monetary penalty · Fresh imposition
Published by RBI
6 Dec 2013
Case Brief
The Reserve Bank of India imposed a monetary penalty of Rs 5.00 lakh on The Kakinada District Co-operative Central Bank Ltd., Andhra Pradesh 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 reply and personal submissions, and then held that the violation was substantiated and warranted 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) after finding that the bank had not adhered to Know Your Customer (KYC) norms and Anti Money Laundering (AML) guidelines. RBI issued a show-cause notice, considered the bank's written reply and personal submissions, and concluded the violations were substantiated.
Operating Impact
The bank must absorb the Rs 5 lakh penalty; the release does not describe a licence restriction or operational ban. The adverse impact is limited to the monetary penalty and the compliance finding, with no stated direct effect on depositors or customers beyond the underlying KYC/AML compliance expectation.
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