Recorded RBI impact
Fine: Rs 1.00 L
Monetary penalty · Fresh imposition
Published by RBI
9 May 2011
Case Brief
The Reserve Bank of India imposed a monetary penalty of Rs 1.00 lakh on The Randheja Commercial Co-operative Bank Ltd., Randheja Dist., Gandhinagar, under Section 47A(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (AACS). RBI said the bank violated instructions on implementation of KYC guidelines and exceeded the prescribed ceiling for donations. The bank had been issued a show-cause notice and submitted a written reply, but RBI concluded the violations were substantiated and warranted the penalty.
Why RBI Acted
RBI imposed a monetary penalty under Section 47A(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (AACS). The bank was found to have violated Reserve Bank instructions on implementation of Know Your Customer (KYC) guidelines and made donations exceeding the ceiling prescribed by RBI. After considering the bank's reply and submissions, RBI held the violations substantiated and penalised the bank.
Operating Impact
The bank must absorb the penalty and comply more closely with RBI instructions on KYC and donation limits going forward. The action does not indicate a business restriction, but it signals heightened compliance expectations for the bank.
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