The Reserve Bank of India is investigating three banks that are active in wealth management and gold selling in order to uncover any “deficiencies and legal loopholes”, it has said in a statement

Axis Bank, ICICI Bank, and HDFC bank are all under scrutiny after media site Cobrapost.com, exposed “sting operations” across some branches of these banks, alleging money laundering and violation of several provisions of the Reserve Bank of India Regulations and other related acts.

“The media firm has uploaded some videos on the internet relating to these banks, as well as ICICI Prudential Life Insurance and HDFC Life Insurance,” the Reserve Bank said.

According to the Economic Times, the business practices of the staff involved in this “sting” are under scrutiny as Cobrapost.com footage showed staff at Axis, ICICI and HDFC Banks as “eager to help clients avoid tax, or convert black money into accounted funds”.

While according to a central bank source, no transaction seems to have been put through, “the financial advice by some of the bank officials could put these banks in trouble".

"The audit is on and we will review the know-your-customer, norms followed at these bank branches. If any lapse is found, we reserve the right to take action or penalise the branch. We will also wait for the internal report of these banks," the official told the Economic Times.

Mis-selling of products, such as insurance or mutual funds, by third-party agents will be considered the responsibility of the bank and viewed with great seriousness. In 2006, RBI fined 17 banks for violation of regulations of KYC norms, breach of prudent banking practices and for not adhering to guidelines related to loans against shares and initial public offering, the publication added.