RBI Slaps Citibank, Bank of Baroda, IOB With Rs 10.34 Cr Fines For Violating Regulatory Standards
On 24 November, the Reserve Bank of India (RBI) levied penalties on Citibank, Bank of Baroda and Indian Overseas Bank (IOB) for non-compliance with regulatory norms. Citibank received a penalty of Rs 5 crore for violating various sections of the Banking Regulation Act, 1949, related to the Depositor Education and Awareness Fund Scheme and outsourcing financial services. The penalty was imposed due to Citibank's failure to timely credit the eligible amount to the Depositor Education and Awareness Fund, payment of commission to staff, and outsourcing AML alert monitoring to a Group company.
In a separate inspection, the RBI fined Bank of Baroda Rs 4.34 crore for non-compliance with directives on creating a Central Repository of Large Common Exposures, loans and advances restrictions, and interest rates on deposits. The RBI discovered that Bank of Baroda did not ensure the accuracy of data on large exposures submitted to RBI, sanctioned term loans without proper due diligence, approved working capital demand loans against government subsidies and failed to pay interest rates on deposits from senior citizens as per disclosed schedules.
Furthermore, Indian Overseas Bank received a penalty of Rs 1 crore after an inspection revealed non-compliance issues related to the financial position as of 31 March 2022. The RBI's actions are aimed at enforcing regulatory compliance and maintaining the integrity of the banking system.
