NEW DELHI: The Reserve Bank of India has levied a Rs. 1 crore penalty over the private banking firm “Dhanalaxmi Bank” for allegedly violating the Know your customers (KYC) and Anti money laundering (AML) norms issued by the Central Bank.
The Bank received a show cause notice from the Reserve Bank of India, the governing body of the Indian financial Banks for allegedly violating the RBI guidelines with respect to an account under investigation by the Economic offenses wing of Mumbai.
The Reserve Bank said in a statement: “After prior investigations, the Reserve Bank of India has found violation of its guidelines over Know your customer and Anti money laundering instructions by the Dhanalaxmi bank and has charged the bank with a penalty of Rs. 10 million”.
Sources said that the RBI took its time to investigate into the issue, which involved various document submissions from the Dhanalaxmi bank before coming to a conclusion over penalizing the Bank.
It was made clear in the statement that the penalty levied was against the irregularities in the bank and is not intended with any transactions entered into by the bank and its customers, the Financial Express said.
Founded in 1927 and headquartered in Kerala, the bank has 280 branches operating in the major cities of the Indian Sub-continent. Dhanalaxmi bank was given the status of a commercial bank in the year 1977.