The FATF said the possible on-site period for India is “to be confirmed (to consider)”. (Representative)
New Delhi:
The long-awaited Financial Action Task Force (FATF) mutual evaluation of India’s anti-money laundering regime and legal measures designed to verify financial crimes, scheduled for this year, has been postponed until early in the year. next year due to the coronavirus pandemic, officials said. .
They said the on-site review to be conducted by experts from the global body was due to start in September-October, but the FATF secretariat in Paris told India the review was tentatively postponed until January. – February of next year.
The FATF is a global money laundering and terrorist financing watchdog that sets international standards to prevent illegal activities in a country’s economic and financial channels and its interconnected links around the world.
It performs “peer reviews of each member on an ongoing basis to assess levels of implementation of FATF recommendations and provides in-depth description and analysis of each country’s system to prevent criminal abuses of the financial system”.
The review of India’s anti-money laundering and terrorist financing regime was scheduled for this year as part of a regular review cycle after 10 years. The last such review was carried out in June 2010, said a senior official at an anti-money laundering agency.
The FATF, after this review, said in 2013 that “India has made significant progress in addressing the gaps identified in its mutual evaluation report and (the FATF) decided that the country should be removed from the process of regular follow-up. “
India has set up a joint task force comprising 22 central investigative, intelligence gathering and regulatory agencies to make presentations and brief FATF experts from different countries this time.
Some of the leading agencies in this group overseen by the Ministry of Revenue under the Ministry of Finance include CBI, ED, Department of Income Taxes, Directorate of Tax Intelligence, Financial Intelligence Unit (FIU) , customs, market regulator SEBI, banking regulator RBI insurance regulator IRDAI.
The Union government had also tasked Rahul Navin, a 1993 Indian Tax Administration officer from the Income Tax Department, to work as a Special Duty Officer (OSD) with the Directorate of execution (ED) to advance these processes.
Mr. Navin is the author of a book titled “ Information Exchange and Tax Transparency: Tackling Global Tax Evasion and Evasion ”, has worked in the international taxation wing of the tax department, and has worked closely with the ‘OECD, another well-known global economic organization.
The ED is the nodal agency to undertake investigations under the Prevention of Money Laundering Act (PMLA) in the country.
A senior official at the Union’s finance ministry said all preparations to brief the FATF review group were nearing completion when the COVID-19 outbreak occurred.
“We have been informed by the FATF that it has postponed the mutual assessment of many jurisdictions scheduled for this year, including that of India, due to the current restrictions on COVID-19. new dates are for the beginning of next year, “the officer told PTI.
The FATF also made a public statement in this context.
“The gravity of the COVID-19 situation around the world and the resulting COVID-19 measures countries have adopted, such as isolation and travel restrictions, are preventing assessed jurisdictions and assessors to carry out on-site and in-person visits. This has had a significant impact on the ability of countries to actively participate in mutual evaluation and related monitoring processes. “
“The FATF Plenary therefore agreed to temporarily postpone all FATF mutual evaluations and follow-up deadlines,” said the FATF.
He said the possible period there for India was “to be confirmed (to be considered)”.
During the visit of the FATF evaluators, said the official of the Ministry of Finance, India prepared to present multiple files of the action taken by it under the anti-money laundering law, criminal investigations tax evasion and the strengthening of the CFT regime (fight against the financing of terrorism). by the Financial Intelligence Unit (FIU) and other agencies.
The promulgation of the Fugitive Economic Delinquents Act in 2018, the Anti-Black Money Act of 2015, amendments to the PMLA over the years, curbing tax evasion under indirect taxes by introducing the GST (tax on products and services), new protocols to better regulate suspicious transactions in banks and financial intermediaries and the 2016 demonetization of two major currencies are part of the Indian presentation, another official at an investigative agency said.
The high number of domestic and international asset seizures under the PMLA and indictment sheets filed by various investigative agencies under the criminal sections of the Financial Crimes and Terrorist Financing Act are also part of India’s presentation to the FATF review team, he said.
The new compliance regime put in place by the FIU for banks and other financial institutions to report suspicious cash and counterfeit transactions will also be part of the presentation, he said.
The review takes around a year to complete and if all deadlines are met, the FATF will discuss India’s financial crime legal system at its plenary meeting in February 2022 and then issue a statement and recommendations on the country, a declared the officer.
