The Financial Intelligence Unit-India has imposed a penalty of Rs 5.49 crore on Paytm Payments Bank for violating money laundering norms.
In a statement issued on March 1, the finance ministry said that its Financial Intelligence Unit began looking into the beleaguered payments bank after receiving information from law enforcement agencies that a few entities and their business network were engaged in illegal activities, including organising and facilitating online gambling.
"Further, the money generated from these illegal operations, i.e. proceeds of crime were routed and channelled through bank accounts maintained by these entities with the Paytm Payments Bank Ltd," the statement said.
"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," the statement added.
The order imposing the penalty on Paytm Payments Bank was dated February 15, just one before the Reserve Bank of India (RBI) gave an extension to the bank to wind up its operations by March 15 instead of February 29.
The announcement of the penalty comes hours after the board of parent firm Paytm approved the discontinuation of several inter-company agreements with Paytm Payments Bank.
The payments bank has been in free-fall ever since the RBI, on January 31, ordered it to wind down its operations due to "persistent non-compliances and continued material supervisory concerns". Since then, Paytm founder Vijay Shekhar Sharma has resigned from the board of the payments bank.
