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It is only KYC norm violation, says RBI

May 07, 2013 12:01 am | Updated November 16, 2021 10:16 pm IST - MUMBAI:

K.C. Chakraborty

K.C. Chakraborty

Reserve Bank of India (RBI) Deputy Governor K.C. Chakrabarty, on Monday, refuted money laundering charges levelled against various banks, and said that all exposures by Cobrapost.com were connected to know-your-customer (KYC) norms.

“We are seeing how the banks are following up on the KYC norms. There are certain differences in the manner of reporting of KYC norms in each bank…Need to strengthen KYC guidelines,” he said.

In March this year, in another sting operation, Cobrapost.com claimed that officials at HDFC Bank, ICICI Bank and Axis Bank had allegedly indulged in money-laundering practices.

Dr. Chakrabarty, however, had said that there was no ‘money-laundering’ practice involved in the Cobrapost-exposure conducted on three leading private banks.

“No scam has happened,” he had said after a meeting with select bankers in March.

Just as he downplayed the issues two months ago, Dr. Chakrabarty reiterated on Monday that these irregularities were also connected only to KYC norm violations.

Federal Bank in a statement said “As a responsible bank, we conduct our business with strict adherence to extant regulatory guidelines, including specific focus on know your customer, and anti-money laundering (AML) norms….The bank has initiated investigations into the matter.”

Internal enquiry

DCB Bank’s spokesperson said, “We are reviewing the contents, and making our internal enquiries. The bank does not allow or accept any breach of rules and regulations including those related to KYC, AML and CFT (Anti-Money Laundering and Countering Financing of Terrorism), etc. We have a very clear code of conduct and values that is reiterated to employees from time to time.”

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