RBI fines 2 Madhya Pradesh cooperatives under anti-money laundering, KYC rules

MUMBAI: Taking serious note of violation of anti-money laundering (AML) and know-your-customer (KYC) norms, the Reserve Bank has imposed fines on Bhopal-based Krishna Mercantile Co-operative Bank (KMCB) and Khargone Nagrik Sahakari Bank (KNSB).

The KMCB has been fined Rs 5 lakh for not following the KYC and AML norms under section 47A (1)(b), read with section 46(4) of the Banking Regulation Act of 1949, the RBI said in a statement.

The KNSB, on the other hand, has been fined Rs 1 lakh for similar violations under the same provisions of the Act, it added.

Show-cause notices have been issued to both the lenders and the decision to fine them after going through their respective replies, it said in the separate releases.

"The Reserve Bank came to the conclusion that the violations were substantiated and warranted imposition of the monetary penalty," it said in both of them.