Recorded RBI impact
Fine: Rs 5.00 L
Monetary penalty · Fresh imposition
Published by RBI
20 Jun 2012
Case Brief
The Reserve Bank of India imposed a monetary penalty of Rs 5.00 lakh on The Kalol Nagrik Sahakari Bank Limited, Kalol, Dist. Gandhinagar (Gujarat). The penalty was imposed under Section 47(A)(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (as applicable to co-operative societies) after RBI found violations of its instructions on Know Your Customer (KYC) norms and Anti Money Laundering (AML) guidelines. RBI considered the bank's written reply and personal submissions, but concluded that the violations were substantiated.
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 (as applicable to co-operative societies) after concluding that the bank had violated Reserve Bank of India instructions relating to Know Your Customer (KYC) norms and Anti Money Laundering (AML) guidelines. The bank had submitted a written reply to the show-cause notice and made personal submissions, but RBI found the violation substantiated and warranted penalty.
Operating Impact
The bank must absorb the financial penalty and the finding of non-compliance on KYC/AML remains on record. No separate operational restriction is described in the release, but the action signals continued regulatory scrutiny of the bank's 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