RBI fines Axis, HDFC & ICICI banks

Cobrapost expose: Reserve Bank slaps fine on three banks
June 10, 2013
Cobrapost expose: RBI fines Axis Bank, HDFC, ICICI
June 10, 2013

RBI fines Axis, HDFC & ICICI banks

The Reserve Bank of India (RBI) today penalised the country’s top three private lenders – ICICI Bank, Bank and Bank – for violating its instructions on know-your-customer (KYC) and anti-(AML) guidelines.

Bank has been fined Rs 5 crore, Bank Rs 4.5 crore and ICICI Bank Rs 1 crore. carried out a scrutiny of the books of accounts, internal control, compliance systems and processes of these three following allegations that these lenders were running a money-laundering racket in India.

“The scrutiny of these three revealed violation of certain regulations and instructions issued by the Reserve Bank of India,” the central bank said. said while investigations did not reveal any prima-facie evidence of money laundering, any conclusive inference can only be drawn by an end-to-end probe of the transactions by tax and enforcement agencies.

The central bank noted that ICICI Bank, Bank and Bank violated instructions on non-adherence of safeguards on issuing ‘at par’ cheques through co-operative and did not adhere to certain aspects of and AML norms. of walk-in customers were not done for sale of third party products.

Also, the three did not file some cash transaction reports and sold gold coins by accepting cash beyond Rs 50,000. Details of customers’ permanent account number (PAN) card or Form 60/61 were not obtained while opening of accounts.

In some cases, source of funds was not ascertained in non-resident ordinary (NRO) accounts. The also failed to re-designate a few accounts as NRO accounts although it was required, said.

None of the three commented on the fines imposed by 

In a sting operation, online magazine Cobrapost had secretly taped employees of ICICI Bank, Bank and Bank offering money-laundering as a product. Later, the portal accused 22 other (including public sector banks) and three insurance companies of indulging in money-laundering activities.

said it conducted a probe at the corporate offices of 36-odd during April and May.

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