The Reserve Bank of India (RBl) has imposed a monetary penalty of Rs one lakh on the Gondia District Central Co-operative Bank Limited, Gondia for non-compliance with certain directions issued by RBI contained in the “Master Direction – Know Your Customer (KYC) Direction, 2016”.
Further, a monetary penalty of Rs five lakh has been imposed on the Guntur Women Cooperative Urban Bank Ltd., Guntur, Andhra Pradesh for contravention of the directions issued by RBI on prohibition of loans and advances to Directors or their relatives, income recognition and asset classification and grant of loans against security of gold jewellery.
A show cause notice was issued to the banks for such non-compliance with the directions. After considering the bank’s reply to the notice, RBI imposed the monetary penalty.
However, this 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 banks with its customers.