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Urban cooperative banks misused for money laundering: Media Report

By Religare
Urban cooperative banks misused for money laundering: Report
Urban Cooperative Banks(UCBs), which hold deposits of over Rs two lakh crore, are being misused for money laundering causing alarm to the government, said a media report.

A report on Gujarat-based cooperative bank has indicated the opening of 9,166 forged savings accounts in the name of the deceased person to launder black money amounting to Rs 161 crore which was deposited and withdrawn immediately, a senior Central Economic Intelligence Bureau (CEIB) official said.

Several gross irregularities were also noticed in RBI reports relating to inspection of another such bank based in Uttar Pradesh, added the media report.

The matter of misuse of UCBs, over which there is dual control by central and state governments was discussed during a recent meeting of Economic Intelligence Council (EIC), chaired by Finance Minister P Chidambaram.

The meeting, which was attended by senior officials CEIB, Reserve Bank of India (RBI) and Finance Ministry, stressed for devising ways to check money laundering through these banks.

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