Mumbai: The Reserve Bank of India has imposed penalty on HDFC Bank and Bank of America under the powers obtained through FEMA sections.
While HDFC has been fined for violating RBI directions on accepting deposits from non-residents, Bank of America has been fined for violating directions on reporting requirements under the Liberalized Remittance Scheme of FEMA 1999. Fine in each case Rs. 10,000.
RBI had issued show cause notices to both the banks, in response to which they also gave written replies and oral arguments. After considering the facts of each case and the responses of both the banks, RBI came to the conclusion that the violation was justified and warranted imposition of penalty.
However, at the same time, the RBI clarified that this action is based on deficiencies in regulatory compliance and is not intended to adjudicate on the validity of any transaction or agreement entered into by the two banks with their customers.
