RBI imposes Rs 1.74-crore fine on HSBC over compliance violation
The banking regulator said that HSBC violated rules relating to submission of information to all four credit information companies
- May 8, 2023,
- Updated May 8, 2023 11:37 PM IST
The Reserve Bank of India on Monday said it imposed a fine of Rs 1.74 crore on The Hongkong and Shanghai Banking Corporation Limited (HSBC), citing "deficiencies in regulatory compliance".
The banking regulator added that HSBC violated rules relating to submission of information to India's credit information bureaux.
"RBI has, by an order dated May 02, 2023 imposed a monetary penalty of Rs 1.74 crore on HSBC for contravention of Rule 20(1) of Credit Information Companies Rules, 2006 (CIC Rules). This penalty has been imposed in exercise of powers vested in RBI conferred under the provisions of section 25 (1) (iii) read with section 23 (4) of Credit Information Companies (Regulation) Act, 2005," said the central bank on Monday.
This action is based on the deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers, said RBI.
The bank was found in contravention of RBI's rules related to furnishing incorrect credit information in respect of several expired credit cards with nil dues to all four credit information companies
"The Statutory Inspection for Supervisory Evaluation (lSE) of the bank was conducted by RBI with reference to its financial position as on March 31, 2021, and the examination of the Risk Assessment Report and all related correspondences revealed contravention of the aforesaid rules by the bank to the extent that it furnished incorrect credit information in respect of a number of expired credit cards with nil dues, to all the four Credit Information Companies. In furtherance to the same, a notice was issued to the bank advising it to show cause as to why penalty should not be imposed for contravention of the said provisions of CIC Rules, as stated therein.
"After considering the bank’s reply to the notice and oral submissions made during the personal hearing, RBI came to the conclusion that the charge of contravention of the aforesaid CIC Rules was substantiated and warranted imposition of monetary penalty," said RBI in a statement.
The Reserve Bank of India on Monday said it imposed a fine of Rs 1.74 crore on The Hongkong and Shanghai Banking Corporation Limited (HSBC), citing "deficiencies in regulatory compliance".
The banking regulator added that HSBC violated rules relating to submission of information to India's credit information bureaux.
"RBI has, by an order dated May 02, 2023 imposed a monetary penalty of Rs 1.74 crore on HSBC for contravention of Rule 20(1) of Credit Information Companies Rules, 2006 (CIC Rules). This penalty has been imposed in exercise of powers vested in RBI conferred under the provisions of section 25 (1) (iii) read with section 23 (4) of Credit Information Companies (Regulation) Act, 2005," said the central bank on Monday.
This action is based on the deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers, said RBI.
The bank was found in contravention of RBI's rules related to furnishing incorrect credit information in respect of several expired credit cards with nil dues to all four credit information companies
"The Statutory Inspection for Supervisory Evaluation (lSE) of the bank was conducted by RBI with reference to its financial position as on March 31, 2021, and the examination of the Risk Assessment Report and all related correspondences revealed contravention of the aforesaid rules by the bank to the extent that it furnished incorrect credit information in respect of a number of expired credit cards with nil dues, to all the four Credit Information Companies. In furtherance to the same, a notice was issued to the bank advising it to show cause as to why penalty should not be imposed for contravention of the said provisions of CIC Rules, as stated therein.
"After considering the bank’s reply to the notice and oral submissions made during the personal hearing, RBI came to the conclusion that the charge of contravention of the aforesaid CIC Rules was substantiated and warranted imposition of monetary penalty," said RBI in a statement.