India at G-20

• India presented a nine-point agenda at the second session of the G-20 Summit on international trade, international financial and tax systems held in Buenos Aires, Argentina.  
• The agenda presented by the Prime Minister calls for joint efforts by member countries to form a mechanism that denies entry and safe havens to fugitive economic offenders.

Nine points agenda on fugitive economic offenders:

1. Strong and active cooperation across G-20 countries to deal comprehensively and efficiently with the menace economic offenders.
2. Cooperation in the legal process such as effective freezing of the proceeds of crime, early return of the offenders and efficient registration of the proceeds of crime should be enhanced and streamlined.
3. Joint effort by G-20 countries to form a mechanism that denies the entry and safe havens to all fugitive economic offenders.
4. Principles of United Nations Convention Against Corruption (UNCAC), United Nations Convention Against Transnational Organised Crime (UNOTC), especially related to “International Cooperation” should be fully and effectively implemented.
5. Financial Action Task Force (FATF) should be called upon to assign priority and focus to establishing international co-operation that leads to timely and comprehensive exchange of information between the competent authority and FIUs.
6. FATF should be tasked to formulate a standard definition of fugitive economic offenders
7. FAFTF should also develop a set of commonly agreed and standardized procedures related to identification, extradition and judicial proceedings for dealing with fugitive economic offenders to provide guidance and assistance to G-20 countries subject to their domestic law.
8. Common platforms should be set up for sharing experiences and best practices including successful cases of extradition gaps in existing systems of extradition and legal assistance etc.
9. G-20 Forum should consider initiating work on locating properties of economic offenders who have a tax debt in the country of their residence for its recovery.
   
   

   Fugitive Economic Offenders in India Who are they? According to Fugitive Economic Offenders Act, 2018, a ‘fugitive economic offender’ is “any individual against whom a warrant for arrest in relation to a scheduled offence has been issued by any court in India, who: (i) leaves or has left India so as to avoid criminal prosecution; or (ii) refuses to return to India to face criminal prosecution.” How a person is declared an offender? A Director, appointed by the central government, will have to file an application to a Special Court to declare a person as a ‘fugitive economic offender’. Under Clause (2) of Section 6, the application must contain: reason/s for the belief that an individual is a fugitive economic offender;  any information available as to the whereabouts of the fugitive economic offender;  a list of properties or the value of such properties believed to be the proceeds of crime, including any such property outside India for which confiscation is sought;  a list of properties owned by the person in India for which confiscation is sought;  a list of persons who may have an interest in any of the properties listed under sub-clauses (c) and (d)  The Director has the power to attach any property the accused holds. What does the offender have to do? A notice is issued by the court to the alleged ‘fugitive economic offender’. Within six weeks from the date of notice, the person has to present himself at “a specified place at a specified time”. If the offender fails to do so, s/he will be declared a ‘fugitive economic offender’ and their properties as listed in the Director’s application will be confiscated. Once property is confiscated, can the offender file a civil claim? Section 11 of the Act disqualifies those declared as offenders from either filing or defending a civil claim in court. What happens to the properties? The Special court will appoint an ‘administrator’ to oversee the confiscated property. This person will be responsible for disposing of the property as well, and the property will be used to satisfy creditors’ claims.

   
   

   Group of Twenty (G20)

   • It is the premier forum for its members’ international economic cooperation and decision-making.
   • The G20 membership comprises a mix of the world’s largest advanced and emerging economies, representing about two-thirds of the world’s population, 85 per cent of global gross domestic product and over 75 per cent of global trade.
   • The members of the G20 are Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Republic of Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, the United Kingdom, the United States and the European Union.

   How G-20 has come into being?

   • It started in 1999 as a meeting of Finance Ministers and Central Bank Governors in the aftermath of the Asian financial crisis.
   • In 2008, the first G20 Leaders’ Summit was held, and the group played a key role in responding to the global financial crisis.
   • Its decisive and coordinated actions boosted consumer and business confidence and supported the first stages of economic recovery.

   Financial Action Task Force

   • It is an inter-governmental body established in 1989 by a Group of Seven (G-7) Summit in Paris
   • Initially, it was supposed to examine and develop measures to combat money laundering.
   • In October 2001, the FATF expanded its mandate to incorporate efforts to combat terrorist financing, in addition to money laundering.

   Objectives of FATF

   • The objectives of the FATF are to set standards and promote effective implementation of legal, regulatory and operational measures for combating money laundering, terrorist financing and other related threats to the integrity of the international financial system.
   • The FATF is therefore a “policy-making body” which works to generate the necessary political will to bring about national legislative and regulatory reforms in these areas.