Monday, October 26, 2020

India to enhance anti-money laundering regulations with IMF policies

-

In an apparent reference to Pakistan, Union Finance Minister Nirmala Sitharaman on Saturday said the integration of the IMF’s lending policies with key provisions like anti-money laundering and anti-terror financing can significantly enhance its member nation’s compliance on these issues that pose threat to the global economy.

Sitharaman’s remarks in her address to the annual meeting of the International Monetary Fund assumes significance in the backdrop of the international terror financing watchdog FATF putting Pakistan on notice on Friday, warning that it will be blacklisted if it does not control terror funding by February next.

“The macro-prudential policies’ interface with anti-money laundering (AML) and countering financing of terrorism (CFT) could be useful in strengthening the integrated policy framework. The IMF’s remit may not be as direct as of the Financial Action Task Force (FATF) in this respect,” Sitharaman said.

“However, integrating AML-CFT with IMF lending policies can significantly enhance member’s compliance on these issues that pose threat to the global economy,” she said without naming Pakistan. The IMF work can also cover elements such as secrecy jurisdictions, cyber-risks and tax havens, the minister added.

- Advertisement -

Sitharaman said the growing global financial integration is bringing in huge opportunities but is also introducing uncertainties and risks. Capital flows benefit countries in terms of higher investment and risk sharing, but at the same time, it can have adverse effect on countries with weak policies and institutions.

Noting that the IMF plays a significant role in assisting the member countries to assess their macro-economic stability and mitigate financial vulnerability, she said the IMF’s proposal to come up with an Integrated Policy Framework is a step in the right direction.

“An effective surveillance mechanism helps countries to identify risks, both global and domestic, and suggest ways to prevent such risks and mitigate their adverse effects,” she said.

India looks forward to how the IMF proposes to factor in the interactions between monetary, exchange rate, macro-prudential, and capital flow management policies in its policy advice, she noted.

- Advertisement -

“In this context, it is very important to build in sufficient policy flexibility for the EMEs (emerging market economies), not just because they are heterogeneous group, but also because they need a wide array of tools which can be contextually used as per needs,” Sitharaman said.

This has been the case especially when there has been a fundamental misalignment of the exchange rate, caused by surges in capital flows. Often sudden stops and reversals of capital flows follow these surges that erode macro-financial stability very quickly, the finance minister said.

“We believe that the policy option of EMEs to preemptively use macro-prudential measures (MPMs) and capital flow measures (CFMs) need to be fully recognised in any integrated policy framework,” she said.

MUST READ

Julius Baer to deny two former CEOs their bonuses over money laundering scandal

Julius Baer will withhold millions of francs in bonuses from its former chief executives Boris Collardi and Bernhard Hodler, as a result of a...

Goldman Sachs executives to cover part payments of $3 billion fines in 1MDB scandal

Nine current or former Goldman Sachs executives, including CEO David Solomon, will have to pay back hundreds of millions of dollars in compensation over...

Goldman Sachs agrees $3 billion settlement with US DoJ over 1MDB corruption scandal

Goldman Sachs has agreed to pay nearly $3bn (£2.3bn) in the US to end a probe of its role in Malaysia's 1MDB corruption scandal. The...

Hong Kong fines Goldman Sachs $350 million over 1MDB scandal

Goldman Sachs ignored multiple red flags over the multibillion-dollar fundraisings it arranged for state fund 1Malaysia Development Berhad, Hong Kong’s financial regulator said on...

Texas attorney general Ken Paxton fires top aide who accused him of bribery

Lacey Mase, one of the top aides who accused Texas Attorney General Ken Paxton of crimes including bribery and abuse of office, has been fired, she told The...

Subscribe For More

Get our daily notification on the latest financial crimes news around the World

Advertisement
Advertisement

Latest News

This Week

US financial watchdog fines bitcoin mixer operator $60m for money laundering

The founder and operator of some of the first "mixing" services in crypto will have to cough up $60 million to United States regulators,...

Former Columbus mayor Eisenga charged with bank fraud

A former Columbus mayor and businessman who was once at the center of a controversial bill aimed at reducing child support payments for wealthy...

EU takes legal action against Cyprus and Malta over investment for citizenship scheme

The European Union’s executive said on Tuesday it was launching legal action against Cyprus and Malta over their investor citizenship programmes, also known as...

Spanish police arrests operator of Crypto Arbitrage firm Arbistar on fraud charges

The CEO of Arbistar the Spanish investment company, Santiago Fuentes, has been arrested and arraigned on charges of fraud, belonging to a criminal organization...
Advertisement

Adblock Detected!

Our website is made possible by displaying online advertisements to our visitors. Please consider supporting us by whitelisting our website.

Enable Notifications    Ok No thanks