The Reserve Bank of India (RBI) has imposed fines to the tune of Rs 73.06 crore in 48 cases involving banks for violating certain provisions or contravention of its directions since January 2020.
The central bank has levied the penalties in brief orders providing little details, according to The Indian Express.
The RBI slapped a public sector bank with a monetary penalty of Rs 32 lakh citing non-compliance with certain provisions of Reserve Bank of India (Fraud classification and reporting by commercial banks and select FIs) Directions 2016, in August this year, the report added.
In the majority of orders passed by the RBI, the banking regulator has said that the fines were imposed for not complying with certain provisions and directions. The orders are in the form of paragraphs on RBI’s website containing sparse details about the violations. On the other hand, penalty orders of regulators such as the Insurance Regulatory and Development Authority (IRDAI) and the Securities and Exchange Board of India (SEBI) are more detailed. They have stated the violation and the modus operandi in their orders, the report said.
RBI’s orders have also drawn ire where some have suggested challenging its decision by setting up an appellate court like the Securities Appellate Tribunal (SAT).
This month, the central bank imposed monetary penalties ranging from Rs 25,000 to Rs 3.1 lakh on nine cooperative banks on account of non-compliance of its guidelines. The banks included The Kendrapara Urban Co-operative Bank, The Berhampur Cooperative Urban Bank, Renuka Nagarik Sahakari Bank Maryadit, The Jamshedpur Urban Cooperative Bank, Krishna Mercantile Co-operative Bank among others, according to nine standalone statements by the RBI.
The RBI cited deficiencies in regulatory compliance for the action taken and said that it was not intended to pronounce upon the validity of any transaction or agreement entered into by the banks with its customers.