Reserve Bank of India imposes monetary penalty on State Bank of India

Case Brief

By an order dated October 18, 2021, RBI imposed a monetary penalty of Rs 1 crore on State Bank of India under section 47A(1)(c) read with sections 46(4)(i) and 51(1) of the Banking Regulation Act, 1949. The penalty was for non-compliance with the RBI’s Fraud Classification and Reporting Directions, 2016, specifically delay in reporting a fraud in a customer account to RBI. RBI said the action was based on regulatory compliance deficiencies and not intended to pronounce upon the validity of any transaction or agreement with customers.