Case Brief
The Reserve Bank of India imposed a monetary penalty of ₹50 lakh on NKGSB Co-operative Bank Ltd. by order dated January 12, 2024. The penalty was levied for non-compliance with the RBI’s Know Your Customer (KYC) Directions, 2016, under sections 47A(1)(c), 46(4)(i) and 56 of the Banking Regulation Act, 1949. RBI’s inspection found that the bank had opened and allowed transactions in current accounts of a company without undertaking customer due diligence. After considering the bank’s reply, additional submissions, and oral arguments, RBI held that the charge was substantiated and warranted a monetary penalty.
Action Snapshot
- Primary Impact
- Fine: Rs 50.0 L
- Entity Type
- Co-operative bank
- Action Type
- Monetary penalty