iconimg Thursday, May 07, 2015

HT Correspondent, Hindustan Times
Mumbai, July 15, 2013
The Reserve Bank of India (RBI) on Monday imposed penalties ranging from Rs. 50 lakh to Rs. 3 crore on 22 banks, including State Bank of India, Canara Bank, Punjab National Bank, Deutsche Bank and Kotak Mahindra for violating customer identification and anti-money laundering rules.

It also issued warning letters to seven other banks.

However, the central bank said that its investigation did not reveal any evidence of money-laundering.

The probe was launched after investigative website Cobrapost raised charges of widespread flouting of the know your customer (KYC) norms and prevalence of money laundering.

RBI had studied the books of accounts and compliance systems of banks in April, which threw up the fact that many banks did not adhere to KYC rules.

“After considering the facts of each case, RBI came to conclusion that some of the violations were substantiated and warranted imposition of monetary penalty,” said the banking sector regulator in the statement.

“The investigation did not reveal any prima facie evidence of money laundering.”

The penalties add up to Rs. 49.5 crore.

RBI has earlier imposed fines totalling Rs. 10.5 crore on top three private lenders - Axis Bank, HDFC Bank and ICICI Bank.

According to RBI, banks did not adhere to the KYC norms for walk-in customers for sale of third-party products and failed to file cash transaction reports in respect of some cash transactions and sale of gold coins for cash beyond Rs. 50,000.

The violation also include non-adherence to instructions on import of gold on consignment basis, limits on remittances under Liberalised Remittance Scheme and repatriation of funds from non-resident ordinary (NRO) account.