The Reserve Bank Of India (RBI) has imposed a penalty on HDFC Bank, Bank of Baroda, and PNB in a forex scam detected last year. The Central Bank of the country imposed monetary penalties of Rs 5 crore on Bank of Baroda, Rs 3 crore on Punjab National Bank and Rs 2 crore on HDFC Bank.
Bank of Baroda said "weaknesses and failures in internal control mechanisms in respect of certain AML (anti-money laundering) provisions such as monitoring of transactions, timely reporting to FIU (foreign investigations unit), and assigning of UCIC (unique customer identification code) to customers", in the BSE statement.
After considering the bank's (HDFC Bank's) submissions, the RBI has imposed a penalty of Rs.20 million on the bank on account of pendency in receipt of bills of entry relating to advance import remittances made and lapses in adhering to KYC (know your customer)/AML guidelines in this respect," HDFC said in its notification.
All the three banks said that they have implemented a comprehensive corrective action plan, to strengthen internal controls and to ensure that such incidents do not recur.
According to the reports, Bank of Baroda's Ashok Vihar branch in New Delhi was the main lead in the entire racket, according to the CBI, where Rs 6,000 crore worth of funds were transferred illegally.
Shares of the HDFC Bank was seen trading marginally lower by 0.40 on BSE at 12.14 pm IST. PNB shares were trading higher by 1.46 per cent at Rs 132. Shares of Bank of Baroda were also seen trading higher by 0.74 per cent at Rs 156.90 during trade.