Reserve Bank of India (RBI) has imposed a whopping Rs 5 crore penalty on Public sector lender Syndicate Bank and Rs 2 crore penalty on Union Bank of India, IndusInd bank etc for breaching Know Your Customer (KYC) norms. Reserve bank on December 12 imposed a monetary penalty of Rs 5 crore on the public sector lender for violating the Know Your Customer (KYC)/Anti-Money Laundering (AML) norms. The banking regulator has exercised these powers vested with it under the provisions of the Banking Regulation Act.
Earlier, RBI had penalized Union Bank of India and IndusInd bank for Rs 2 crore for non-compliance of KYC norms. In October, Yes Bank was fined Rs 6 crore for non-compliance of asset disclosures and security breach disclosure rules while IDFC Bank was fined Rs 2 crore not adhering to the loans and advances norms.
RBI has done the scrutiny in certain branches of the bank in the aftermath of a fraud reported in these branches. Based on the findings of the scrutiny and examination of related documents obtained in this regard, a Notice was issued to the bank advising it to show cause as to why penalty should not be imposed for non-compliance with directions/guidelines issued by RBI.