The Financial Action Task Force (FATF), an international body that monitors money laundering and terrorist financing, recently issued a report highlighting concerns about terrorist financing in India. It points to terrorist organizations like ISIS and Al Qaeda as significant threats, particularly in regions like Jammu & Kashmir.
India is facing a threat from terrorist groups in Jammu & Kashmir who are getting money through illegal means, according to a report by the Financial Action Task Force (FATF) released on Thursday. These groups, like ISIS and Al Qaeda, are using the funds to carry out their activities. The report says India needs to keep a closer watch on where the money is coming from and going to in order to stop it from reaching these terrorists. The Paris-based organization said that most of the money laundering in India comes from illegal activities happening within the country. It also warned that India faces a variety of terror threats, with the biggest ones coming from ISIS and groups linked to Al Qaeda, especially in and around Jammu & Kashmir.
Money laundering convictions affected by constitutional challenges’
The FATF report pointed out that getting convictions for money laundering in India has been difficult over the past five years. This is mainly due to legal challenges and an overloaded court system. India’s courts are dealing with a massive backlog of cases, causing many to remain unresolved for years. This delay is making it harder to tackle financial crimes effectively.
The FATF report revealed that the Enforcement Directorate (ED) in India has seized assets worth €9.3 billion ($10.4 billion) from suspected financial criminals over the last five years. However, the amount actually confiscated after convictions was much lower, less than $5 million.
The report stressed the importance of India addressing this gap, noting that many accused individuals are still waiting for their cases to go to trial and for prosecutions to be completed. This delay in the legal process makes it harder to recover the money and hold criminals accountable.
Indian laws effected against money laundering but prosecution needs improvements
The FATF report recognized that India has a good system in place to fight money laundering and terrorist financing. However, it also said that India needs to make big improvements in prosecuting these cases more effectively.
The report also mentioned that India should do more to protect non-profit organizations from being misused for terrorist activities.
The FATF’s 368-page report, released in June, is the first evaluation of India’s efforts to tackle money laundering and terrorist financing since 2010. Based on an on-site visit conducted in November, India has been placed in the “regular follow-up” category. This puts India alongside only four other G20 nations in this group, meaning the country will be closely monitored to ensure ongoing improvements.
The next full evaluation of India’s progress is scheduled for 2031, giving the country time to address key areas for improvement, particularly in enforcing stricter prosecution and safeguarding vulnerable sectors from abuse by terrorist groups.