Mumbai, Nov. 15 :    Mumbai, Nov. 15:  The State Bank of India has agreed to pay the $ 7.5 million fine imposed on it by the US regulators for violation of banking laws and failure to maintain accurate records. . The fines result from the bank's apparent engagement in unsafe and unsound practices related to its failure to establish and maintain procedures designed to assure and monitor compliance with the Bank Secrecy Act. It failed to maintain correct and accurate books and records and make reports to the New York State banking department,. the Federal Reserve said in a joint statement with the Federal Deposit Insurance Corporation and the New York state banking department on Wednesday. . The SBI, without admitting to any allegations, consented to the issuance of the order,. the statement said, adding the Indian entity agreed to pay a total of $ 7.5 million in fines. .One half of this amount will be paid to the US treasury department and the other half to the State of New York under applicable federal and state laws,. it said. Reacting to the order, SBI chairman Janki Ballabh, said, .The order is an action plan for improving the bank's accounting system, introducing enhanced due diligence, enlarging coverage of internal audit and setting up a focussed department for ensuring compliance.. Ballabh, however, made it clear that SBI's operations in the US have not been disrupted or affected in any way. .We have agreed to pay the amount and we don.t want to create any further controversies,. a senior bank official said. However, a Reserve Bank of India spokesperson, when contacted, had no comments to offer. The penalty against SBI is a culmination of events that had one time even extended to charges of money laundering by Russian mafia as claimed by the US authorities through certain accounts relating to Indo-Russian trade and the export earners foreign currency (EEFC) accounts. It also included dealings with some undertakings that were banned by the US in view of the sanctions following the Pokhran nuclear tests. One of the crucial aspects of the issue related to the identity of the account holder, where more stringent regulations exist in the US. Here the allegation of the US authorities were that the SBI did not follow .know your customer. rule apart from other due diligence methods while maintaining these accounts.This, it said,may have led to money laundering. According to bankers, the US authorities maintained its stand despite two rounds of meetings with representatives of the Reserve Bank of India (RBI). For instance, in the issue of dealings with some undertakings that were banned following the nuclear tests, it was observed that few of the entities held EEFC accounts in India and made foreign currency payments abroad. Though this is perfectly in conformity with RBI regulations, the US authorities were not comfortable with the practice. This concern was very much in evidence in the order given by the Federal Reserve which asked the SBI to tighten its procedures for accepting funds for transfer out of the US by its .non-resident Indian. department in its US operations.