"The Reserve Bank of India has imposed a penalty of INR 50 million on Bank of Baroda... Pursuant to the internal audit of the Bank of Baroda, the Reserve Bank of India and investigative agencies in October 2015 were advised by the Bank of certain irregularities observed," Bank of Baroda said in a BSE filing.
It further said: "The RBI carried out the investigation and noted the deficiencies which were reflective of weaknesses and failures in internal control mechanisms in respect of certain AML provisions such as monitoring of transactions, timely reporting to FIU, and assigning of UCIC to customers".
Bank of Baroda said it has implemented a comprehensive corrective action plan, to strengthen internal controls and to ensure that such incidents do not recur.
Various irregularities by bank such as non-submission and inordinate delays in filing of Suspicious Transaction Reports (STRs), besides opening of accounts by several entities without fulfilling KYC norms, were noticed by Reserve Bank of India.
The observation came as part of inspection done by the central bank after last year's Bank of Baroda case in which Rs 6,100-crore import remittances were effected by its Ashok Vihar branch here.
Both CBI and the Enforcement Directorate are probing the huge remittances to Hong Kong from the bank. The amount was allegedly transferred in the garb of payments for imports that never took place, investigators say.
After the BoB case, RBI wrote a confidential letter to chairmen and chief executives of all commercial banks asking them to review existing policies and effect necessary improvements where warranted to avoid recurrence of such irregularities.
Shares of Bank of Baroda were trading 1.92 per cent at Rs 153.80 apiece on the BSE.