Recorded RBI impact
Fine: Rs 50,000
Monetary penalty · Fresh imposition
Published by RBI
13 Jun 2024
Case Brief
By an order dated June 11, 2024, RBI imposed a monetary penalty on The Kancheepuram Central Co-operative Bank Ltd., Kancheepuram, Tamil Nadu. The action followed NABARD’s statutory inspection of the bank as of March 31, 2023, which found non-compliance with NABARD’s directions on ‘Frauds - Guidelines for Classification, Reporting and Monitoring’. RBI noted that the charge of delay in reporting fraud to NABARD was sustained after considering the bank’s reply and oral submissions, and imposed the penalty under section 47A(1)(c) read with sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.
Why RBI Acted
RBI imposed a monetary penalty after its statutory inspection and supervisory review found non-compliance with NABARD directions on ‘Frauds - Guidelines for Classification, Reporting and Monitoring’. The bank’s reply and oral submissions were considered, but RBI sustained the charge that there had been delay in reporting of fraud to NABARD. The penalty was imposed under section 47A(1)(c) read with sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.
Operating Impact
The bank must bear the monetary penalty of ₹50,000. The release states that the penalty is without prejudice to any other action RBI may initiate, so additional supervisory or enforcement measures remain possible in future.
Regulatory Basis
- section 47A(1)(c) read with sections 46(4) (i) and 56 of the Banking Regulation Act, 1949
Action Facts
- Primary Impact
- Fine: Rs 50,000
- Order Date
- 11 Jun 2024
- Effective From
- 11 Jun 2024
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank