25/02/09 India poised to have FATF entry approved

February 25, 2009  |   International News   |     |   0 Comment

New Delhi: A Bill aimed at effectively combating money-laundering, terror financing and cross-border economic offences was passed by Parliament on Tuesday, with the Lok Sabha approving the measure.

The Prevention of Money Laundering (Amendment) Bill, 2009, passed by the Rajya Sabha last week, seeks to ensure a legal framework to check such crimes. Winding up a discussion on the Bill in the Lok Sabha, minister of state for finance PK Bansal assured the House that the government would not be found wanting in taking action against those indulging in money-laundering. The new law seeks to check use of black money for financing terror activities.

Financial intermediaries like full-fledged money changer, money transfer service providers such as Western Union and International Payment gateways, including VISA and MasterCard have also been brought under the ambit of The Prevention of Money-Laundering Act.

Consequently, these intermediaries, as also casinos, will be brought under the reporting regime of the enforcement authorities. It would also check the misuse of promissory notes by FIIs, who would now be required to furnish all details of their source.

Bansal said the Act would check misuse of “proceeds of crime” be it from sale of banned narcotic substances or breach of the Unlawful Activities (Prevention) Act.

The passage of the Prevention of Money Laundering (Amendment) Bill, 2009 will enable India’s entry into Financial Action Task Force (FATF), an inter-governmental body that has the mandate to combat money laundering and terrorist financing.

The Bill, after becoming an Act, will address India’s international obligation and empower the enforcement directorate to search the premises immediately after the offences are committed and police have filed a report.

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