India Praised by FATF for Strong Fight Against Money Laundering and Terror Financing
The Financial Action Task Force (FATF) has given a positive evaluation to India for its efforts in combating money laundering and terror financing. India has achieved a significant milestone by securing a ‘Regular Follow-up’ rating from the global watchdog.
Key Highlights from the FATF Report
The report, titled ‘Anti-money laundering and counter-terrorist financing measures,’ states that India has the main structural elements required for an effective system, including high-level commitment, political stability, and rule of law. India has shown strong results in technical compliance with FATF standards.
However, the report also notes areas needing improvement, such as:
- Strengthening prosecution
- Protecting the non-profit sector from terrorist abuse
- Supervision and implementation of preventive measures
The Enforcement Directorate (ED) is the main authority investigating money laundering activities. The ED has been effective in seizing assets, with EUR 9.3 billion attached over the last five years.
India’s Response
Reacting to the FATF’s commendation, India’s Ministry of Finance stated that this recognition is a testament to the country’s commitment to combating financial crimes. The ministry highlighted that India is now among an elite group of just four G20 nations with a ‘Regular Follow-up’ rating from FATF.
“A significant milestone and a proud moment in our fight against money laundering and terrorist financing,” the finance ministry said. The ministry also emphasized the importance of global collaboration in this fight.
Doubts Revealed
FATF -: FATF stands for Financial Action Task Force. It is an international organization that works to stop illegal activities like money laundering and terror financing.
Money Laundering -: Money laundering is when people try to hide money they got from doing bad things, so it looks like it came from good activities.
Terror Financing -: Terror financing is when people give money to support terrorist activities. This is illegal and very dangerous.
Regular Follow-up -: A ‘Regular Follow-up’ rating means that India is doing a good job but still needs to keep working on some areas to be even better.
Prosecution -: Prosecution is when the government takes someone to court because they think that person did something illegal.
Non-profit sector -: The non-profit sector includes organizations that work to help people and do good things without making money for themselves.
Ministry of Finance -: The Ministry of Finance is a part of the Indian government that handles money matters, like taxes and financial laws.
