The Prudential Authority, which serves as the central bank of South Africa, has taken disciplinary action against the State Bank of India (SBI) for violating the country’s anti-money laundering laws. SBI has been penalized with a fine of 10 million rand (approximately Rs 4.5 crore) for failing to comply with certain provisions of the Financial Intelligence Centre Act.
According to SBI’s statement to the exchanges, the penalty was imposed under Section 45C of South Africa’s Financial Intelligence Centre (FIC) Act 38 of 2001. This section grants the FIC the authority to issue directives to ensure compliance with the Act and take measures to address money laundering concerns.
SBI has confirmed that it promptly paid 5.5 million rand (approximately Rs 2.5 crore) as part of the penalty imposed by the South African branch. Additionally, the bank will pay the remaining 4.5 million rand (approximately Rs 2 crore) in installments over a period of 36 months, as per the prescribed timeline.
It’s worth noting that in 2018, another public sector lender, Bank of Baroda, closed its operations in South Africa due to regulatory issues related to transactions in accounts controlled by the Gupta Brothers. The controversy surrounding the Gupta Brothers ultimately led to the resignation of then-president Jacob Zuma.
