India has addressed shortfalls in its black money fight: FATF

Jun 26 2013, 15:08 IST
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India has substantially addressed the technical deficiencies identified in relation to customer. (Reuters) India has substantially addressed the technical deficiencies identified in relation to customer. (Reuters)
SummaryIndia has substantially addressed the technical deficiencies identified in relation to customer.

In a major boost to measures being taken by India against money laundering and terror financing activities, the Financial Action Task Force (FATF) today said the country has substantially addressed the deficiencies in its regulatory framework and has become largely compliant with global standards in this regard.

FATF is an inter-governmental body that sets standards, and develops and promotes policies to combat money laundering and terrorist financing for countries across the world.

With a substantial improvement in India's regulatory provisions, FATF has also decided to remove the country from its regular follow-up process for determining its compliance to for anti-money laundering and countering financing of terrorism (AML/CFT) regulations.

The move would help India get greater support from international authorities in its fight against black money and check the illicit flow of funds from and to the country.

In its latest report on India, FATF said it has "recognised that India had made significant progress in addressing deficiencies identified in its mutual evaluation report (of June 2010) and decided that the country should be removed from the regular follow-up process".

India was earlier placed in the regular follow-up process for mutual evaluation purposes because of partially compliant (PC) ratings on certain core and key Recommendations.

"Since the publication of the mutual evaluation report (in June 2010), India has been reporting back to the FATF on a regular basis on the progress made in the implementation of its Action Plan to strengthen India's AML/CFT System.

"India has made significant progress with regard to the implementation of this action plan," FATF said.

Among various improvements in the past three years, India has rectified "nearly all of the technical deficiencies identified with respect to the criminalisation of money

laundering and terrorist financing and the implementation of effective confiscation and provisional measures".

Besides, India has substantially addressed the technical deficiencies identified in relation to customer due diligence and other preventive measures, FATF said.

It said India has also further enhanced "its outreach programme to provide guidance to the financial sector on the suspicious transaction reporting obligations and engaging in extensive compliance monitoring, and as brought several of the Designated Non-Financial Businesses and Professions (DNFBPs) within the scope of its preventive AML/CFT measures.

"At its June, 2013 Plenary meeting, the FATF decided that India had reached a satisfactory level of compliance with all of the core and key Recommendations and could be removed from the regular follow-up process," the international body said.

India became

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