Money Laundering Current Affairs - 2020

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FATF Plenary meet: Pakistan to be scrutinized

The six-day plenary meeting of FATF – Financial Action Task Force is to be held in Paris. It is a part of the FATF Week that is being celebrated between October 13 and October 18, 2019. The meeting is attended by representatives from 205 countries and jurisdictions all around the world. It includes IMF, UN, World Bank and other leading organizations. The meeting will focus on financial flows that are linked to terrorism and crime.

The China Factor in the Meet

It is the first Plenary meeting under the Presidency of China. Among the important factors to be discussed in the meet the progress by Pakistan, Iran and other countries that present risk to the financial system is highly crucial, especially for China. This is because, Pakistan being an all-weather ally of China, all eyes are to be focused on China.

In the June Plenary meet, Pakistan received 3 needed votes from China, Turkey and Malaysia. This prevented the country from entering the blacklist.

India, UK and USA want Pakistan to be included in FATF Black list while China and Turkey are against the move.

FATF on Pakistan

The countries are recommended to the blacklist category based on the Mutual Evaluation Report. According to the report published in 2019, of 10 effective ratings, Pakistan was found low in 9 areas.

In its money laundering report, 2019, FATF slammed Pakistan for its terror funding.

Plenary meet

The FATF plenary year begins in July and ends in June. Every year, the FATF holds three plenary meetings. They usually take place in October, June and February. This October the following discussions are to be made in the plenary meet

  • To assess if the countries are regulating virtual asset sector to prevent misuse of crime and terror
  • To assess Russia and Turkey measures to combat money laundering
  • To discuss the impact of “stable coins” on the supervision of virtual assets
  • Actions taken by Ireland, Denmark, Norway, Singapore, Spain and Saudi Arabia since their assessments
  • Developments in financing of Al – Qaeda, ISIL and Affiliates

FATF Blacklist

The FATF black list or the OECD black list is issued by the FATF since 2000. Such description is given to those countries that are non – cooperative in the global fight against money laundering and terrorist financing. The FATF is updated regularly.

Current South Korea and Iran are in the FATF Blacklist category.

FATF Grey list

The FATF Grey list comprises of those countries that have flaws in their financial regulation. The countries that are currently under FATF grey list are Bahamas, Botswana, Cambodia, Ethiopia, Ghana, Pakistan, Panama, Sri Lanka, Syria, Trianidad and Tobago, Tunisia and Yemen

Pakistan was added to the Grey list category in 2012 and later was removed from the list in 2015. However, in 2018 it was again added to the grey list category.

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National Coordination Center – A database of Maoists

The Government of India is planning to set up a National Coordination Center (NCC) that will function as a data bank of Maoists. It will act as a synergy point for anti – Maoist operations and intelligence gathering.

Key features of the NCC

  • It will create a strategy for security agencies to counter support received by the Maoist leaders. It will also control the sympathy gained or created by the Maoists in the social media
  • It will utilize knowledge of retired police officers who served in anti – Maoist operations in Odisha, Andhra Pradesh and Chattisgarh.
  • NCC will identify the sources of finance to the Maoists and work to neutralize the network

Maoism in India

  • The number of Maoist incidents was 500 in 1989. It has come down to 354 in 2018
  • The Geographical spread of Maoism has reduced in the last five years
  • In the last 10 years before 2018, the number of police stations affected with violence has come down to 250 from 465.

Main regions of Maoism

The most formidable strong hold of Maoism is southern areas of Chattisgarh, Andhra – Odisha border, parts of Jharkhand. In particular the three districts Bijapur, Sukma and Dantewada have strong hold of Maoists. South Sukma has encountered around 150 Maoist attacks.

The prospective base areas of Maoist leaders include Saranda forest, Parasnath hills, areas adjoining districts of Bihar.

Concerns of Maoism

  • Gaining the trust of the locals is the major challenge. The locals were killed mercilessly in public on mere suspicion of being alleged police informers.
  • The mobile towers in and around these areas are very less. This affects the flow of intelligence from the core areas to execute operations against the Maoists. In Bijapur district, there were only 50 towers for a combined area of 6,000 square kilometers.

Significance of NCC

  • Government takes measures to address the administrative vacuum which is the major challenge in addressing Maoism. Around 20 camps were established in South Bastar last year
  • The Andhra – Odisha border and some districts of Odisha are inaccessible. The continuous exploitation of inter – state boundaries by the Maoists is the major concern. The NCC will help to combat this exploitation.
  • The Center will work with the Indian Institute of IED Management to analyze various types of IEDs used by the Maoists.
  • Joint operations between the state police is also being suggested. This will help to concentrate on tri – junctions of the LWE affected states, especially in the borders. NCC will work towards achieving this goal
  • NCC will also help in real time information sharing, joint action and coordination among different states, etc.

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