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The regional office (West Bengal and Sikkim) of Reserve Bank of India has conducted a preliminary scrutiny of banks’ adherence to know-your-customer and anti money-laundering guidelines.
The scrutiny was initiated in the wake of the Rs 120-crore fraud involving forgery of term deposit receipts.
According to B. P. Kanungo, Regional Director (West Bengal and Sikkim), RBI, “We have conducted a scrutiny across several banks on a test-case basis on the behest of our central office. The report has been submitted to the central office,” Kanungo told newspersons on the sidelines of an interactive session on the Indian banking sector organised by the Bengal National Chamber of Commerce and Industry here on Wednesday.
The matter came to fore when State-owned West Bengal Infrastructure Development Finance Corporation Ltd (WBIDFC) alleged a Rs 120-crore fraud by a branch manager of UCO Bank. WBIDFC had between August last year and early January transferred Rs 120 crore in two tranches to Kolkata-based UCO Bank to start term deposits.
In another instance, West Bengal State Co-operative Bank had two fixed deposit certificates of Rs 20-crore each with UCO Bank and Indian Overseas Bank, which were also found to be “fake”.
UCO Bank had lodged complaints about the two alleged frauds with the Central Bureau of Investigation.
The Police later arrested Indrajit Chatterjee, the alleged mastermind of the Rs 120-crore fraud.
The RBI’s scrutiny is limited to the KYC and AML adherence of banks. “We are focusing on whatever is document based and which falls within our domain,” Kanungo said.
The regional office of RBI has been conducting awareness camps to caution people against investing in schemes floated by “fly-by-night” operators, Kanungo said.
Chit funds
The RBI is one of the members on the empowered committee on regulation of non-banking finance companies (NBFC). The committee has members from the Police, State Government, SEBI, Registrar of Companies and National Housing Bank among others.
“This committee meets half-yearly and discusses matter pertaining to NBFCs. These Ponzi schemes are not floated by NBFCs and hence do not fall under RBI domain,” he said.
However, based on its own market intelligence reports, the RBI did come to know of some fly-by-night operators. “As an apex bank we have tried to generate awareness among people in collaboration with the Consumer Affairs Ministry by conducting camps for people at various levels,” he added.
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