The Financial Action Task Force (FATF) adopted the mutual evaluation report of India during the agency’s two-day plenary held in Singapore on Friday. FATF has placed India in the ‘regular follow-up’ category and there are only four other G20 countries in the category, the finance ministry said.
In its brief outcome statement, the global body said that India's legal regime in anti-money laundering and countering financing terrorism domains was achieving good results. The finance ministry said the ratings “sets a benchmark for countries in our region to effectively implement international standards on terrorist financing”.
The ministry said, “Indian authorities have had success in dismantling the terror funding network using actionable intelligence inputs. These operations have stemmed the flow of terror funding, black money, and narcotics, even along the coastline.”
In a note, FATF observed India needs to address delays relating to concluding money laundering and terrorist financing prosecutions. The final evaluation report for the country will be published later when the "quality and consistency review" is completed, it said.
"Improvements are needed to strengthen the supervision and implementation of preventive measures in some of the non-financial sectors. India also needs to address delays relating to concluding money laundering and terror funding prosecutions, and to ensure that CFT measures aimed at preventing the non-profit sector from being abused for terror funding are implemented in line with the risk-based approach, including by conducting outreach to NPOs on their TF risks," it said.
The Paris-headquartered body leads global action to tackle money laundering, terrorist and proliferation financing.
India's mutual evaluation of FATF guidelines, a measure that checks a country's efficacy to make effective laws and policies and implement them to check financial crimes, was last done in 2010. A FATF peer review of India ended early this year after the team made an 'on-site' or a physical visit to New Delhi and met officials from various intelligence and investigative agencies.