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RBI Fines Four Cooperative Banks Rs 9 Lakhs for Rule Violations

Fraud, Bribery & CorruptionRBI Fines Four Cooperative Banks Rs 9 Lakhs for Rule Violations

The Reserve Bank of India (RBI) has levied monetary fines on four cooperative banks this week for violating RBI rules and regulations, resulting in a total penalty of Rs 9 lakh.

The penalized banks are as follows:

  1. Baroda Gujarat Gramin Bank, Vadodara (Gujarat)
  2. Aska Cooperative Central Bank Ltd., Aska
  3. Bally Cooperative Bank Ltd., Howrah, West Bengal
  4. Nabapalli Co-operative Bank Ltd., West Bengal

The RBI, in an order dated August 07, 2023, has imposed a Rs 5.00 lakh penalty on Baroda Gujarat Gramin Bank for not adhering to NABARD’s guidelines on fraud classification, reporting, and monitoring.

A Rs 50,000 penalty has been imposed on Aska Cooperative Central Bank Ltd. for failing to comply with certain provisions of RBI’s “Know Your Customer (KYC) Direction, 2016”.

Similarly, Bally Cooperative Bank Ltd. faces a Rs 1,00,000 penalty for non-compliance with specific provisions of the “Reserve Bank of India – (Know Your Customer (KYC)) Direction, 2016”.

Furthermore, Nabapalli Co-operative Bank Ltd. is subject to a Rs 2,50,000 penalty for not adhering to RBI’s directions on “Exposure Norms and Statutory/Other Restrictions – UCBs” and certain provisions of the “Reserve Bank of India – (Know Your Customer (KYC)) Direction, 2016”.

The penalties have been imposed under the authority granted to RBI by the Banking Regulation Act, 1949, under Sections 47 A (1) (c), 46 (4) (i), and 56.

It’s important to note that these penalties are a result of regulatory compliance shortcomings and do not question the validity of any transactions or agreements between the banks and their customers.

By FCC Times Team, RZOLUT

 

By FCCT Editorial Team

Disclaimer: The views expressed in this article are independent views solely of the author(s) expressed in their private capacity.

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