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Money laundering: 'RBI teams to audit banks'


Updated: March 18, 2013, 4:26 PM IST
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Money laundering: 'RBI teams to audit banks'
The Income Tax Department is also expected to initiate action against the indicted staff of the three banks.

New Delhi: In more trouble for the banks that were indicted in a recent Cobrapost expose, which caught some of the employees of HDFC, ICICI and Axis banks offering money laundering services, the Reserve Bank of India (RBI) has sent its teams to those branches of the banks for an audit. The results of the audit is expected by March 31.

Sources said that the RBI had sent in 30 teams for the purpose.

In a statement, the central bank said, "The RBI has initiated the process of carrying out
comprehensive scrutinies covering both, Head Office and branches of three private sector banks, namely, ICICI Bank, HDFC Bank and Axis Bank."

"The final reports on all the three banks will be completed by March 31, 2013 and thereafter further course of action as necessary will be initiated," it added.

"The scrutinies have been initiated after an online media firm on the basis of its sting operations across some branches of these banks alleged money laundering and violation of several provisions of the RBI Regulations," RBI said.

The Finance Ministry is also looking into the
allegations. Meanwhile, the three private sector banks, named in the sting operation, have started their own internal investigation. They have also suspended staff concerned pending probe.

Sources said that the IT Department is also likely to initiate action against the staff of the indicted banks.

In addition to the money laundering operations, the RBI is also probing allegations of violation of Know-Your-Customer (KYC) norms against the three private lenders. The RBI will also be sending its teams to the headquarters of the three banks for system verification.

Meanwhile, all three banks extended their fall on Dalal Street on Monday, losing over four per cent in the trade.

With additional information from PTI

First Published: March 18, 2013, 4:26 PM IST
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