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20
July 2017
 |
Indian Money (The Total Investment & Insurance
Solutions)
The
US has commented on Prime Minister Narendra Modi's demonetisation move, saying
that while one of the purposes cited by him was to counter terrorist activity
funded by counterfeit currency, India has yet to implement laws effectively on
criminal convictions or take steps to ensure companies are adhering to
anti-money laundering rules.
The
US State Department, in its Country Reports on Terrorism, under the section
Countering the Financing of Terrorism, says: "In November, Prime Minister
Modi announced the demonetisation of 500 and 1,000 rupee currency notes and
asserted that one purpose of this initiative was to curb terrorist activity
funded by counterfeit notes, black money, and stockpiled cash reserves. The Total Investment & Insurance Solutions
"Although
the Government of India aligned its domestic anti-money laundering/countering
the financing of terrorism (AML/CFT) laws with international standards by
enacting amendments to the Prevention of Money Laundering Act in 2012, and in
2016 initiated a National Risk Assessment for anti-money laundering/countering
the financing of terrorism to assess the countrya�s terrorist financing risk,
it has yet to implement the legislation effectively, especially with regard to
criminal convictions."
It
said law enforcement agencies in India acetypically open criminal
investigations reactively and seldom initiate proactive analysis and longa'term
investigations.
"While
the Indian government has taken action against certain hawala financing
activities, prosecutions have generally focused on non-financial businesses
that conduct hawala transactions as a secondary activity. Additionally, the
government has not taken adequate steps to ensure all relevant industries are
complying with AML/CFT regulations.
"The
reporting of terrorism-related Suspicious Transaction Reports (STRs) has shown
an increasing trend in recent years, with India's Financial Intelligence Unit
receiving 112,527 STRs between July 2015 and May 2016. The Total Investment & Insurance Solutions
In
another criticism, it said that the degree of training and expertise in
financial investigations involving transnational crime or terrorism-affiliated
groups varied widely among the federal, state, and local levels and depended on
the financial resources and individual policies of various jurisdictions. The Total Investment & Insurance Solutions
It
said that US investigators "have had limited success in coordinating the
seizure of illicit proceeds with Indian counterparts". The Total Investment & Insurance Solutions
"While,
in the past, intelligence and investigative information supplied by US law
enforcement authorities led to numerous seizures of terrorism-related funds, a
lack of follow-through on investigative leads has prevented a more
comprehensive approach."
The
report also said that India is a member of the Financial Action Task Force
(FATF) and two FATF-style regional bodies -- the Eurasian Group on Combating
Money Laundering and Financing of Terrorism and the Asia/Pacific Group on Money
Laundering.
India's
Financial Intelligence Unit-India is a member of the Egmont Group of Financial
Intelligence Units. The Total
Investment & Insurance Solutions
The
government regulates the money services business (MSB) sector, requiring the
collection of data for wire transfers and the filing of suspicious transaction
reports (STRs) by non-profit organizations. The Total Investment & Insurance Solutions
"While
the Indian government supervised, regulated, and monitored these entities to
prevent misuse and terrorist financing, a large unregulated and unlicensed MSB
sector remained vulnerable to exploitation by illicit actors," it noted.The Total Investment & Insurance Solutions
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