Gujarat Mercantile Co-operative Bank based in Ahmedabad was recently found allowing cash withdrawal of Rs 20.00 lakh after banking hours. The matter came to the notice of RBI which has taken exception to the issue.
The apex bank has reacted by imposing a monetary penalty of Rs 5.00 lakh on the UCB in exercise of powers vested in it, said a press release.
The Regulator also faulted it for doing so without the approval of Board of Directors and non-reporting of Suspicious Transaction report (STR) to Financial Intelligence Unit-India (FIU-IND).
The Reserve Bank of India had issued a Show Cause Notice to the bank, in response to which the bank submitted a written reply.
After considering the facts of the case, the bank’s reply as also personal submissions in the matter, the Reserve Bank came to the conclusion that the violations was substantiated and warranted imposition of penalty.