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The Reserve Bank of India (RBI) has imposed, by an order dated September 22, 2022, a financial penalty of ₹1.00 lakh (Rupees One lakh solely) on Balitikuri Cooperative Bank Ltd., Balitikuri, West Bengal (the financial institution) for contravention of/non-compliance with the instructions issued by RBI on Know Your Customer (KYC). This penalty has been imposed in train of powers vested in RBI beneath the provisions of Section 47 A (1) (c) learn with Section 46 (4) (i) and Section 56 of the Banking Regulation Act, 1949, taking into consideration the failure of the financial institution to stick to the aforesaid instructions issued by RBI. This motion relies on deficiencies in regulatory compliance and isn’t supposed to pronounce upon the validity of any transaction or settlement entered into by the financial institution with its clients. Background The inspection report of the financial institution based mostly on its monetary place as on March 31, 2020, revealed, inter alia, that the financial institution had not undertaken periodic evaluation of danger categorisation of its clients, in contravention of/non-compliance with the aforesaid instructions issued by RBI. Based on the identical, a Notice was issued to the financial institution advising it to indicate trigger as to why penalty shouldn’t be imposed for non-compliance with the instructions. After contemplating the financial institution’s reply and extra submissions made by it, RBI got here to the conclusion that the aforementioned cost of non-compliance with RBI instructions have been substantiated and warranted imposition of financial penalty. (Yogesh Dayal) Press Release: 2022-2023/936 |
