An evaluation, by the Financial Action Task Force (FATF), to analyze the effectiveness of India’s anti-money laundering and countering terrorist financing regime has been postponed again, for the second time, because of the pandemic.
About the Financial Action Task Force (FATF) Review
- The FATF conducts “peer reviews of each member to assess levels of implementation of the FATF recommendations.
- It provides an in-depth description and analysis of each country’s system for preventing criminal abuse of the financial system.”
- The last such review of India was held in June 2010 and it is usually taken up again after 10 years.
Initiatives by the Indian government against money laundering
- Guidelines and rules under the Prevention of Money Laundering Act (PMLA), 2001
- Know Your Customer (KYC) procedures
- Fugitive Economic Offenders Act in 2018
- Anti-black money Act, 2015
- Foreign Exchange Regulation Act (FERA), 1973
- Foreign Exchange Management Act (FEMA) in 1999
- Indian Customs Act, 1962
- Smugglers and Foreign Exchange Manipulators Forfeiture of Property Act, 1975
- Foreign Contribution (Regulation) Act, 1976
- The promulgation of the Prevention of Terrorism Act (POTA), 2002
- India is a signatory to the 1988 United Nations Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances (the Vienna Convention).
Financial Action Task Force (FATF)
- The Financial Action Task Force (FATF) is aninter-governmental financial watchdog.
- It develops and promotes policies to combat money laundering and financing of terrorism.
- It is consisting of 39 countries with major financial centers in Europe, North and South America, and Asia and two international organizations have proposed a set of 40 recommendations to combat money laundering.
- FATF has developed the FATF Recommendations, or FATF Standards, which ensure a coordinated global response to prevent organized crime, corruption, and terrorism.
- On June 25, 2010, India became the 34th country member of FATF.