Non-compliance of directions: RBI slaps Rs 1cr penalty on SBItext_fields
Mumbai: The Reserve Bank of India (RBI) on Monday imposed a monetary penalty of Rs 1 crore on the country's largest lender, State Bank of India (SBI), for not complying with directions issued by the central bank with regard to fraud classification and reporting by commercial banks.
"SBI has been penalised for violating rules related to frauds classification and reporting by commercial banks and select financial institutions," the RBI said in a statement.
The action against SBI is based on the 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 RBI said.
The central bank conducted a review of SBI in a customer account maintained with it and the examination of the scrutiny report revealed non-compliance with the directions on reporting of fraud in the said account to SBI, the central bank said.
"In furtherance to the same, a notice was issued to the bank advising it to show cause why penalty should not be imposed on it for such non-compliance with the said directions," the RBI said.
Earlier on Monday, the central bank had imposed a penalty of ₹ 1.95 crore on Standard Chartered Bank for failing to report a cyber security incident.
The penalty on Standard Chartered Bank has been imposed for not complying with directions issued by the RBI on 'Customer Protection - Limiting Liability of Customers in Unauthorised Electronic Banking Transactions', 'Cyber Security Framework in Banks', 'Credit Card Operations of banks' and Code of Conduct in Outsourcing of Financial Services by banks', among others, the central bank said in a separate statement.
These monetary penalties have been imposed in exercise of powers vested in RBI under the Banking Regulation Act, 1949, it said.