RBI levies Rs 5 crore penalty on Syndicate Bank for breaching KYC norms


Syndicate Bank has emerged as the latest entrant on the Reserve Bank of India’s hit list for violation of norms.

The central bank on December 12 imposed a monetary penalty of Rs 5 crore on the public sector lender for violating the Know Your Customer (KYC)/Anti-Money Laundering (AML) norms.

This comes on the heels of RBI fining private sector lender IndusInd Bank Rs 2 crore for non-compliance of asset recognition norms.

The banking regulator has exercised these powers vested with it under the provisions of the Banking Regulation Act.

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“A scrutiny was conducted by RBI of certain branches of the bank in the aftermath of a fraud reported in these branches. Based on the findings of the scrutiny and examination of related documents obtained in this regard, a Notice was issued to the bank advising it to show cause as to why penalty should not be imposed for non-compliance with directions/guidelines issued by RBI,” RBI said in its statement on its website.

After considering the bank’s reply and oral submissions made in the personal hearing, RBI came to the conclusion that the aforesaid charges of non-compliance with RBI directions/guidelines were substantiated and warranted imposition of monetary penalty, it added.

Earlier, RBI had penalised Union Bank of India Rs 2 crore for non-compliance of KYC norms.

In October, Yes Bank was fined Rs 6 crore for non-compliance of asset disclosures and security breach disclosure rules while IDFC Bank was fined Rs 2 crore not adhering to the loans and advances norms