Mumbai: The global anti-money laundering watchdog Financial Action Task Force (FATF) has asked India to improve due diligence on the bank accounts of politicians, government officials and their families s due to their potential susceptibility to bribery and corruption.
A FATF report shared with the government recommended more rigorous monitoring of the source of funds in the accounts of domestic PEPs as well as requiring senior bank managers to approve any new accounts for politicians, government officials and their families.
The FATF rated India as “compliant” and “largely compliant” on 37 out of the 40 parameters for enforcing anti-money laundering laws. The report raised three major concerns on partial compliance including bank scrutiny of domestic political figures and oversight of the finances of non-profit organisations and non-financial businesses and professionals.
Last month FATF concluded India had a “high level of technical compliance” with its standards to counter money laundering and terror financing and urged that global rules, politicians, their families, and close associates are subject to checks on their bank accounts.
The anti money laundering watchdog report recommended more rigorous monitoring of the source of funds in the accounts of domestic PEPs as well as requiring senior bank managers to approve any new accounts for them or their families.
The government assured the parliament last December it did not intend to put domestic political figures under stricter banking scrutiny ahead of the general election.
FATF had praised India for “high level of technical compliance” with its standards to counter money laundering and terror financing and New Delhi’s mechanisms were outstanding for achieving good results. “India's anti-money laundering and counter terrorist financing regime achieving good results but needs to address delays relating to concluding of money laundering and terrorist financing prosecutions,” said FATF report.
The Mutual Evaluation Report of India, which was adopted in the FATF plenary held in Singapore last month placed India in the ‘regular follow-up’ category, a distinction shared by only four other G20 countries marking a significant milestone in the nation’s efforts to combat money laundering (ML) and terrorist financing (TF).
