The Reserve Bank of India (RBI) has refused to share its banks’ inspection reports on alleged money laundering laws and other violations with Central Economic Intelligence Bureau (CEIB), citing legal hurdles.
The RBI was required to share relevant extracts of inspection reports with law enforcement agencies and CEIB, an apex intelligence agency under the Finance Ministry, to check black money and other financial crimes where gross violations of Know Your Customer (KYC) guidelines and Prevention of Money Laundering Act (PMLA) are noticed, official sources said.
It had earlier given assurance about sharing of information relating to Foreign Exchange Management Act (FEMA) violations with CEIB, which they share with Enforcement Directorate (ED), they said.
But the central bank has not been sharing such information, the sources said.
The matter of non-sharing of inspection reports by RBI with CEIB was discussed during a recent meeting of the Economic Intelligence Council (EIC) headed by Finance Minister Arun Jaitley.
At the meeting, it was highlighted by the CEIB chief that while initially RBI had agreed to share the extracts of inspection reports with it but, later on, they changed their stand.
RBI has cited “legal impediments” in sharing the reports with CEIB as it is not a statutory body, the sources said quoting minutes of the meeting.
The Central Board of Direct Taxes (CBDT) has also highlighted the issue of “non-cooperation” by RBI in sharing the information sought by the income tax department under it.
RBI had reportedly refused to share the inspection reports of a few banks, which were penalised by it, on non-compliance of KYC norms.