The Financial Action Task Force (FATF), the global anti-money laundering watchdog, has called on India to speed up its prosecutions in financial fraud cases, noting that while the country is compliant in most areas, its handling of money laundering investigations and prosecutions remains only “moderately” effective. Despite significant asset seizures, India’s backlog of court cases and constitutional challenges have delayed convictions, with only a small fraction of assets being confiscated following convictions.
Areas of Improvement: Political Figures and Non-Profit Oversight
The FATF report identified partial compliance in areas like the scrutiny of political figures’ wealth, and the financial oversight of non-profit organizations and non-financial businesses. It also flagged India’s vulnerability to money laundering linked to corruption, drug trafficking, cybercrime, and financing from groups operating in the Indian Illegally Occupied Jammu and Kashmir (IIOJK) region. The FATF urged India to conclude prosecutions and effectively sanction those involved in illicit financing activities.