The Financial Intelligence Unit-India (FIU-IND) has on Friday slapped Paytm Payments Bank with a penalty of Rs 5.49 crore in connection with violation of its obligations under the Prevention of Money Laundering Act.
Based on the information received from law enforcement agencies, the financial intelligence body, which comes under the Department of Revenue, Government of India, had reviewed some businesses that engaged in illegal activities. These businesses carried out illegal operations including organising and facilitating online gambling and routed the proceeds of crime through the bank accounts maintained with Paytm Payments Bank.
“After considering the written and oral submissions of the Paytm Payments Bank Ltd, Director, FIU-IND, based on the voluminous material available on record, found that the charges against Paytm were substantiated. Consequently, vide order dated February 15th, 2024 in exercise of his powers under Section 13, PMLA, it was found to be appropriate to impose a penalty of Rs. 5,49,00,000,” read the press statement.
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FIU India has issued a compliance show cause notice to PPBL for violations of various PML rules related to Anti-Money Laundering, Combating the Financing of Terrorism and Know Your Customer safeguards in respect of Payout services and beneficiary accounts.
The penalty comes just days after media reports suggested that the Enforcement Directorate (ED) had not found any violation under the Foreign Exchange Management Act (FEMA) during the inquiry of Paytm Payments Bank Limited (PPBL) transactions.
Read more about the Paytm’s compliance debacle saga and the way ahead for its Founder and CEO Vijay Shekhar Sharma in our March Cover: “End of the Road for Vijay Shekhar Sharma?”
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