The Reserve Bank of India has imposed, by an order dated July 15, 2022, a monetary penalty of ?6.00 lakh (Rupees Six lakh only) on Shri Chhatrapati Rajarshi Shahu Urban Co-operative Bank Limited, Beed, (M.H.).
The UCB was faulted for contravention of/ non-compliance with the directions issued by RBI to Urban Cooperative Banks on Frauds – Classification and Reporting.
This 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 inspection report of the bank based on its financial position as on March 31, 2020, revealed, inter alia, that the bank had delayed in reporting of frauds to RBI in contravention of/ non-compliance with the directions issued by RBI on Frauds – Classification and Reporting. Based on the same, a Notice was issued to the bank advising it to show cause as to why penalty should not be imposed for non-compliance with the directions.
After considering the bank’s replies, oral submissions made during the personal hearing and additional submissions made by the bank, RBI came to the conclusion that the aforesaid charge of non-compliance with the RBI directions was substantiated and warranted imposition of monetary penalty.