HindustanTimes Thu,18 Sep 2014

RBI quizzes 3 private banks on laundering

HT Correspondent, Hindustan Times  Mumbai, March 15, 2013
First Published: 01:29 IST(15/3/2013) | Last Updated: 03:11 IST(15/3/2013)

The Reserve Bank of India on Thursday asked ICICI Bank, HDFC Bank and Axis Bank for information on allegations that they are helping customers convert black money into white as a standard service.


Earlier in the day, investigative website Cobrapost, which made this sensational charge, said such illegal conversions, called money laundering, are being done with the full knowledge of the senior managements of the three banks.

RBI deputy governor Urjit Patel said, “We have been in touch with the banks and have asked for information on the matter.”

The apex bank is expected to follow this up with a formal notice soon.

Reacting to the allegations, the three banks announced their own investigations into the matter.

“ICICI Group conducts its business with the highest level of compliance to legal and regulatory requirements. All employees of the group are trained and required to adhere strictly to the group code of conduct, including anti-money laundering and know your customer norms,” the ICICI Bank spokesperson said.

HDFC Bank and Axis Bank also issued similar statements.

The Cobrapost report said its undercover correspondent approached executives of the three banks across the country over five months – in many cases as a walk-in customer – pretending to work for a fictitious politician who wanted to launder money.

All the methods suggested by the executives were in violation of RBI guidelines.

Reacting to the news, shares of these banks fell sharply on Thursday morning but soon regained lost ground and ended the day with gains on the stock markets.

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