The Reserve Bank of India has imposed a monetary penalty of Rs. 5.00 lakh (Rupees five lakh only) on The Kakinada District Co-operative Central Bank Ltd., Andhra Pradesh in exercise of powers vested in it under the provisions of Section 47(A)(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (As applicable to Co-operative Societies), for non-adherence to Know Your Customers (KYC) norms and Anti Money Laundering (AML) guidelines.

The Reserve Bank of India had issued a show cause notice to the bank in response to which the bank submitted a written reply. After considering the facts of the case, the bank's reply and personal submissions in the matter, the Reserve Bank of India came to the conclusion that the violation was substantiated and warranted imposition of the penalty.

Ajit Prasad

Assistant General Manager

KYC non-compliance prompts regulatory monetary penalty after show cause process for cooperative bank AML failures. The central banking regulator imposed a monetary penalty on The Kakinada District Co operative Central Bank Ltd. under powers available through the Banking Regulation Act as applicable to co operative societies for failure to adhere to Know Your Customer (KYC) norms and Anti Money Laundering (AML) guidelines. The regulator issued a show cause notice, considered the bank's written reply and personal submissions, found the violation substantiated, and exercised statutory authority to levy the penalty.