Context

Financial Action Task Force (FATF) has postponed the analysis of the effectiveness of India’s anti-money laundering and countering terrorist financing regime, for the second time, because of the pandemic.

About

About the Financial Action Task Force (FATF)

• The Financial Action Task Force (FATF) is aninter-governmental financial watchdog.
• It develops and promotes policies to combat money laundering and financing of terrorism.
• It is consisting of 39 countries with major financial centers in Europe, North and South America, and Asia and two international organizations have proposed a set of 40 recommendations to combat money laundering.
• FATF has developed the FATFRecommendations, or FATF Standards, which ensure a coordinated global response to prevent organized crime, corruption, and terrorism.
• On June 25, 2010,India became the 34th country member of FATF.

Key facts about the Financial Action Task Force (FATF) Review

• The FATF conducts “peer reviews of each member to assess levels of implementation of the FATF recommendations.
• It provides an in-depth description and analysis of each country’s system for preventing criminal abuse of the financial system.”
• The last such review of India was held in June 2010 and it is usually taken up again after 10 years.

Initiatives by the Indian government against money laundering Guidelines and rules under the Prevention of Money Laundering Act (PMLA), 2001 Know Your Customer (KYC) procedures Fugitive Economic Offenders Act in 2018 Anti-black money Act, 2015 Foreign Exchange Regulation Act (FERA), 1973 Foreign Exchange Management Act (FEMA) in 1999 Indian Customs Act, 1962 Smugglers and Foreign Exchange Manipulators Forfeiture of Property Act, 1975 Foreign Contribution (Regulation) Act, 1976 The promulgation of the Prevention of Terrorism Act (POTA), 2002 India is a signatory to the 1988 United Nations Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances (the Vienna Convention).