The Reserve Bank of India has imposed a monetary penalty of Rs. 5.00 lakh (Rupees five lakh only) on National Central Co-operative Bank Ltd., Bettiah, Bihar in exercise of powers vested in it under the provisions of Section 47(A) read with Section 46 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

Non compliance with KYC/AML norms results in a regulatory penalty under banking supervision powers. Regulatory imposition of a monetary penalty on a cooperative bank for non adherence to Know Your Customer and Anti Money Laundering requirements, following a show cause notice and consideration of the bank's written reply and personal submissions under the Banking Regulation Act framework applicable to cooperative societies.