Blackmoney: FIU begins tracking overseas money transfer

As part of its enhanced measures to check black money, country's elite Financial Intelligence Unit (FIU) has begun tapping information on all suspicious cross-border fund transfers made from India to offshore destinations.

The premier technical snoop wing under the Finance Ministry has rolled out a new system where all banking and financial institutions are mandated to file formatted Cross Border Wire Transfer Reports (CBTRs) exceeding Rs 5 lakh to it under the provisions of anti-money laundering laws.

According to a FIU report, also accessed by PTI, all financial intermediaries and agencies operating in India need to send these reports to the FIU on a monthly basis and also in those cases where the funds movement are below the stipulated benchmark of Rs 5 lakh but look to be "suspicious or inter-related."

"The Indian FIU is one of the few agencies of its kind in the world to have implemented this new mechanism, aimed to check black money, from the domestic economic channels to locations abroad.

"The FIU is aggressively working to enhance its new platform to analyse Illicit Financial Flows (IFF) from India which has been a major irritant when it comes to combating the menace of illegal funds. The job is being done aggressively and diligently," a senior official said, quoting the report.

The report, while commenting on the new action of the FIU, said "several studies, including those by the OECD (global economic body), indicate that developing countries lose hundreds of millions of dollars every year through illicit flows, including through trade mis-invoicing.

"It is hoped that the analysis of CBTR data will help in analysing the problem of IFF from India," it said.

The new measure has been implemented and notified to all banking organisations, financial intermediaries, insurance companies, payment system operators and capital market operatives by the FIU under the provisions of the Prevention of Money laundering Act (PMlA) beginning 2013-14, the report said.

A CBTR pertains to transfer of funds through various banking channels abroad.

As part of efforts to check the menace, the FIU, after an amendment in the PMlA, has also begun getting reports from the sub-Registrar or Registrar or real estate agents about the registration and sale of any immovable property in the country.

Also, dealers in precious metals, stones and other high- value goods and those engaged in safekeeping and administration of cash and liquid securities on behalf of other persons (like Angadia) are supposed to send Suspicious Transaction Reports (STRs) to the financial intelligence body.

The latest report had also said the government detected over Rs 7,800 crore of illegal monies within the country and abroad during 2013-14 as the FIU found an all-time high cases of suspicious transactions in the country's economic channels.