Reserve Bank of India imposes monetary penalty on four banks

Case Brief

By orders dated January 31, 2019, RBI imposed monetary penalties on four banks for failure to comply with directions on monitoring the end use of funds, exchange of information with other banks, classification and reporting of frauds, and restructuring of accounts. The action was taken under Section 47A(1)(c) read with Section 46(4)(i) of the Banking Regulation Act, 1949. RBI clarified that the penalties were imposed for regulatory compliance deficiencies and were not meant to pronounce on the validity of any transaction or agreement with customers.