Context:
India’s financial intelligence unit issued new alert indicators under PMLA for various sectors to combat money laundering and terrorism financing.
New Alert Indicators:
| Sector | New Alert Indicators |
| Capital Markets | Stockbrokers misusing client funds |
| Depositories | Detection of suspicious off-market transfers |
| Insurance Sector | Anti-Money Laundering/Counter-Terrorist Financing (AML/CFT) analysis of fraud alerts experienced by insurance companies |
| Online Payment Gateways | Transaction speed leading to AML/CFT risks |
| VDA or Cryptocurrency Service Providers | Instructions to register with FIU for “enhanced due diligence to implementation of travel rule” “Travel Rule”, extended to crypto companies in 2019 by the Financial Action Task Force (FATF), requires businesses to collect and share the personal data of participants in a transaction. |
| Credit Rating Agencies | Timely submission of Suspicious Transaction Reports (STRs) to FIU and identification of serious corporate frauds with AML/CFT implications |
| Debenture Trustees | Regular reports from debenture issuers and taking necessary action in the interest of debenture holders upon noticing breaches of trust deed or law |
| Real Estate Agents (DNFBP) | Guidelines for STR reporting under PMLA |
India’s Financial Intelligence Unit (FIU-IND):
- Established in 2004, it operates as an independent body.
- Reports directly to the Economic Intelligence Council led by the Finance Minister.
- Functions –
- Include receiving, analyzing, and disseminating information on suspicious financial transactions.
- Coordinates efforts with national and international agencies to combat money laundering and terror financing.
- Employs specialized agencies like the Enforcement Directorate and Central Bureau of Investigation
- Participates in international cooperation through memberships in organizations like FATF and the Eurasian Group.
Source: Economic Times
Previous Year Question
Consider the following statements with reference to India:
1. According to the ‘Micro, Small and Medium Enterprises Development (MSMED) Act, 2006, the ‘medium enterprises’ are those with investments in plant and machinery between ₹15 crore and ₹25 crore.
2. All bank loans to the Micro, Small and Medium Enterprises qualify under the priority sector.
Which of the statements given above is/are correct?
[UPSC Civil Services Exam – 2023 Prelims]
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2
Answer: (b)
Explanation:
Medium Enterprise: An enterprise where the investment in plant and machinery or equipment does not exceed ₹50 crore, and turnover does not exceed ₹250 crore.
