 "Money laundering: Over 480 urban cooperative banks under lens")
About 480 urban cooperative banks have come under the scanner of the Reserve Bank of India (RBI) for alleged violation of anti-money laundering laws, sources say.
The central bank has been taking strict action, like imposition of penalty and denial of branch expansion, against erring, official sources said.
RBI has issued instructions to its regional offices to undertake scrutiny of 489 such banks to ascertain compliance of Know Your Customer, Anti-Money Laundering and Combating the Financing of Terrorism guidelines.
RBI has been coordinating with the state governments on the issue and advised strict action against defaulting banks.
It has issued guidelines to block accounts of all non-complying customers, the sources said.
It has been observed that the problem of irregularities in the urban cooperative banks is of a “grave nature”, given their wide reach and penetration across the country with 8,100-plus branches which have huge deposits to the tune of Rs 2.09 lakh-crore and advances worth Rs 1.35 lakh-crore, according to a report by Central Economic Intelligence Bureau.
About 70 per cent of these urban cooperative banks are subjected to inspection every year.
The central bank has been taking strict action, like imposition of penalty and denial of branch expansion, against erring, official sources said.
RBI has issued instructions to its regional offices to undertake scrutiny of 489 such banks to ascertain compliance of Know Your Customer, Anti-Money Laundering and Combating the Financing of Terrorism guidelines.
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The matter of misuse of urban cooperative banks, over which there is dual control by central and state governments, for money laundering has been a matter of concern for central intelligence agencies.
RBI has been coordinating with the state governments on the issue and advised strict action against defaulting banks.
It has issued guidelines to block accounts of all non-complying customers, the sources said.
It has been observed that the problem of irregularities in the urban cooperative banks is of a “grave nature”, given their wide reach and penetration across the country with 8,100-plus branches which have huge deposits to the tune of Rs 2.09 lakh-crore and advances worth Rs 1.35 lakh-crore, according to a report by Central Economic Intelligence Bureau.
About 70 per cent of these urban cooperative banks are subjected to inspection every year.