RBI imposes monetary penalty on The Tamil Nadu State Apex Co-operative Bank Limited, Chennai

Case Brief

By order dated April 21, 2023, RBI imposed a monetary penalty of Rs 16.00 lakh on The Tamil Nadu State Apex Co-operative Bank Limited, Chennai. The action was taken for contravention of section 26A(2) read with section 56 of the Banking Regulation Act, 1949 and for non-compliance with NABARD directions on review of frauds and monitoring/reporting requirements. RBI said the statutory inspection revealed two lapses: failure to transfer eligible amounts to the Depositor Education and Awareness Fund within the prescribed period, and delayed reporting of a fraud to NABARD. After considering the bank's reply, further submissions, and oral submissions, RBI concluded the violations were substantiated and warranted the penalty.