RBI imposes monetary penalty of Rs. 2 Crores to UCO Bank and Axis Bank Limited for the non- compliance of Circular issued on January 22, 2014 on ‘Collection of Account Payee Cheques – Prohibition on Crediting Proceeds to Third Party Account’ dated January 22, 2014 and Master Directions on ‘Frauds – Classification and Reporting by commercial banks and select FIs’ dated July 01, 2016 .
Thereafter, RBI imposes monetary penalty of ₹ 1Crore to Syndicate Bank for the non- compliance of Master Circular on Frauds – Classification and Reporting dated July 01, 2015 and Circular on Risk Management Systems in Banks dated October 07, 1999 issued by RBI.
The above mentioned penalty has been imposed in exercise of powers vested in RBI under Section 47A (1) (c) read with Section 46 (4) (i) of the Banking Regulation Act, 1949 taking into account the failure of the bank to adhere to the aforesaid directions issued by RBI.
RBI states that 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.