The Reserve Bank on 10 June 2013 imposed a fine of 5 crore Rupees on Axis Bank, 4.5 crore Rupees on HDFC Bank and 1 crore Rupees on ICICI Bank for violation of KYC norms and anti-money laundering guidelines.
The fine was imposed after inquiring into charges pointed by an online portal Cobrapost.
The violations were related to
• Non-observance of certain safeguards in respect of arrangement of “at par” payment of cheques drawn by cooperative banks
• Non-adherence to certain aspects of knowing your customer (KYC) norms.
• Anti -money laundering (AML) guidelines like risk categorization and periodical review of risk profiling of account holders.
The penalty accompanies inspection carried out by RBI of books of accounts, internal control, compliance systems and processes of these three banks at their corporate offices and branches during March/April 2013.The scrutiny was carried on to investigate into the allegations of contravention of Know Your Customer (KYC)/ anti-money laundering guidelines against them following expose by online portal Cobrapost.
RBI will be conducting an end-to-end investigation of the transactions by tax and enforcement agencies. A similar scrutiny is also being conducted at corporate offices of 36 other banks.
It is worth mentioning here that, in certain cases, the banks failed to obtain permanent account number (PAN) card details or form 60/61 and verify the source of funds credited to a few non-resident ordinary (NRO) accounts.