The Reserve Bank of India (RBI) on July 18 imposed a monetary penalty of Rs 6 lakh on Shri Chhatrapati Rajarshi Shahu Urban Co-operative Bank for violating norms pertaining to classification and reporting of frauds.
The central bank’s inspection report revealed that the bank had delayed in reporting of frauds to RBI in contravention of regulations, according to a press release from the central bank.
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The action is based on 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, the regulator said.
Also read: RBI penalises two co-operative banks for rule violations
The central bank has been tightening its grip on regulated entities, specifically cooperative banks, to ensure that appropriate corporate governance practices are followed.
The banking regulator, on July 4, has imposed a monetary penalty of Rs 2 lakh on Tamil Nadu-based The Palani Co-operative Urban Bank for violating directions issued under exposure norms and statutory, or other, restrictions for urban cooperative banks.
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It had also imposed a monetary penalty of Rs 2 lakh on Kolkata-based Dhakuria Cooperative Bank for not complying with the above mentioned guidelines and for violating the RBI’s Know Your Customer (KYC) norms. Ulhasnagar-based Nav Jeevan Co-operative Bank was also fined Rs 2 lakh for sanctioning certain loans in breach of the ceiling on unsecured advances.
Prior to that, on June 27, the RBI had imposed a monetary penalty of Rs 10 lakh on Tamil Nadu-based The Tiruchengode Cooperative Urban Bank as it did not comply with directions issued on exposure norms and statutory or other restrictions pertaining to urban cooperative bank and KYC guidelines.
