RBI imposes Rs 1.12 crore monetary penalty on Bank of Maharashtra

Mumbai (Maharashtra) [India]: The Reserve Bank of India (RBI) on Monday said it has imposed a monetary penalty of Rs 1.12 crore on Bank of Maharashtra for non-compliance with certain directions related to Know Your Customer (KYC).

The Statutory Inspection for Supervisory Evaluation (ISE) of the bank was conducted by RBI with reference to its financial position as on March 31, 2020. Also, scrutinies were conducted in the matter of non-credit of customs duty to the Government Account by the bank, the RBI said in a statement.
The examination of the Risk Assessment Report & Inspection Report pertaining to the ISE, scrutiny reports and all the correspondence related to the same, revealed, inter-alia, non-compliance with the aforesaid directions issued by RBI to the extent the bank (i) failed to allot Unique Customer Identification Codes (UCIC) to its individual customers, (ii) failed to ensure integrity and quality of data submitted to RBI in CRILC, and (iii) did not enter into any Service Level Agreement (SLA) and failed to review the outsourcing arrangement for one of the outsourced financial services.

“In furtherance to the same, a notice was issued to the bank advising it to show cause as to why penalty should not be imposed on it for failure to comply with the said directions,” the RBI said.

After considering the bank’s reply to the notice, oral submissions made during the personal hearing and examination of additional submissions made by it, RBI came to the conclusion that the charge of non-compliance with the aforesaid RBI directions was substantiated and warranted imposition of monetary penalty, to the extent of non-compliance with such directions, the RBI said.

However, the RBI further noted that the “action is based on the deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers”. (ANI)


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