At the time of on-boarding of the customers, banks are required to assess their customers, their business and expected turnover in their account, source of such transactions etc. In recent times, we have come across several instances of banks having allowed transactions in their customers’ accounts without any due consideration to their declared business profiles.
The accounts received multiple RTGS/NEFT inward transactions and several such remittances were sent out of these accounts as well. Several accounts were abused to send money abroad in the form of advance import remittances. Despite the disproportionate activity in such accounts, the monitoring mechanism of banks fell short of our expectations.