Current Affair 1:

News:

The global money laundering and terror financing watchdog Financial Action Task Force (FATF) came out with the Mutual Evaluation Report for India recently.

What exactly is the Mutual Evaluation report?

Mutual Evaluations have two main components, effectiveness and technical compliance.

1. The most important part of a mutual evaluation is a country’s effectiveness ratings. This is the focus of an on-site visit by a team of experts to the assessed country. During this visit, the assessment team will require evidence that demonstrates that the assessed country’s measures are working and delivering the right results.
2. The assessment of technical compliance is also an important part of a mutual evaluation. The assessed country must provide information on the laws, regulations and any other legal instruments it has in place to combat money laundering and the financing of terrorism and proliferation.

On the above basic evaluation:

India has been placed in “regular follow-up” which is the highest rating category by FATF. UK, France and Italy are among the only G-20 countries which have been placed in this category apart from India.

Most of the developing countries are in the “enhanced follow-up” category, which requires submission of reports on an annual basis, as against once in three years in the “regular follow-up” category.

The Financial Action Task Force (FATF) first conducted a mutual evaluation of India on June 24, 2010.

Why this recognition?  I will give you one example.   As per the FATF, India has implemented an anti-money laundering and counter-terrorist financing (AML/CFT) framework that is achieving good results, including on risk understanding, access to beneficial ownership information and depriving criminals of their assets. Authorities make good use of financial intelligence and co-operate effectively, both domestically and internationally.

 

This is all about Mutual Evaluation report.

 

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