Recorded RBI impact
Fine: Rs 1.00 L
Monetary penalty · Fresh imposition
Published by RBI
29 Mar 2011
Case Brief
The Reserve Bank of India imposed a monetary penalty of Rs 1.00 lakh on The Sathamba People's Co-operative Bank Ltd., Sathamba, District Sabarkantha, Gujarat. The penalty was issued under Section 47A(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (AACS) for violation of RBI instructions on implementation of KYC/AML guidelines and persistence of irregularities pointed out in a previous inspection report. RBI considered the bank's reply to the show-cause notice and its oral submissions before concluding 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 (AACS) after finding that The Sathamba People's Co-operative Bank Ltd. had violated RBI instructions on implementation of Know Your Customer (KYC) / Anti-Money Laundering (AML) guidelines. RBI also noted persistence of irregularities pointed out in its previous inspection report. The bank had received a show-cause notice, submitted a written reply, and made oral submissions, but RBI concluded the violations were substantiated and warranted penalty.
Operating Impact
The bank must absorb the monetary penalty; no broader business restriction or licence action was announced. The finding may also signal continued supervisory scrutiny over KYC/AML compliance and remediation of previously noted irregularities.
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