RBI penalises 22 banks for violation of instructions
RBI has imposed monitory penalty on 22 banks including SBI, Federal Bank, Bank of Baroda, Punjab National Bank, etc.. for violation of its instructions on Know Your Customer(KYC) ,Anti Money Laundering(AML) etc..Besides imposing monitory penalty RBI has issued cautionary letter to seven other banks including State Bank of Patiala, Standard Chartered Bank, etc…
The penalties have been imposed in exercise of powers vested in the Reserve Bank under the provisions of Section 47(A)(1)( c ) read with Section 46(4)(i) of the Banking Regulation Act, 1949.
On scrutiny of books of accounts, internal control, compliance systems and processes of these banks revealed that, there has been violation in instructions issued by RBI. Violations founded are:
- Non-adherence to certain aspects of know your customer (KYC) norms and anti money laundering (AML) guidelines like customer identification procedure, risk categorisation, periodical review of risk profiling of account holders, periodical KYC updation;
- Non-adherence of KYC for walk in customers including for sale of third party products, omission in filing of cash transaction reports (CTRs) in respect of some cash transactions, sale of gold coins for cash beyond ` 50,000;
- Non-adherence to instructions on monitoring of transactions in customer accounts;
- Non-adherence to instructions on classification of accounts as ‘in-operative’/dormant and lapses in monitoring of transactions in dormant accounts;
- Non-adherence to instructions which prohibits acceptance of cash above ` 50,000 from customers for sale of gold coins and issue of Demand Drafts, etc.;
- Non-adherence to instructions on the upper limit for remittances under Liberalised Remittance Scheme, upper limit for repatriation of funds from non resident ordinary (NRO) accounts;
- Non-adherence to instructions on import of gold on consignment basis.