The Union Bank of India has been fined Rs 54 lakh by the Financial Intelligence Unit (FIU) for violating the Prevention of Money Laundering Act (PMLA).
The penalty was issued on October 1 due to the bank's failure to report suspicious transactions and inadequate due diligence regarding certain accounts at its Hill Road branch in Mumbai.
The FIU's investigation found that the bank did not comply with know your customer (KYC) and anti-money laundering (AML) regulations.
A detailed review of specific current accounts revealed that a non-banking financial company (NBFC) and its associated entities were engaged in significant circular fund transfers, which were managed through entities under common control.
The findings were confirmed through written and oral submissions from the bank.