November 25 2016
India may have launched a strike on black money hoarders, criminals counterfeiting high value notes and financiers of terrorist groups with its demonetization move, but weak law enforcement and deficiencies in the system have meant zero conviction rate when it comes to nabbing these frauds, say recent reports by the US State Department.
Last year, the Ministry of Finance signed an MoU with the US department of Treasury to enhance co-operation against money laundering and terrorism financing. Accordingly, the two countries conducted a joint-dialogue on AML/CFT. Based on the information submitted by Indian authorities to the US as part of this cooperation, the International Narcotics Control Strategy Report states, “…the government has not won any court cases involving money laundering or confiscations.” It also said “money laundering investigations without a predicate offense are rarely successfully prosecuted in the Indian judicial system and even if they are, the resulting punishment is often minimal,” the INSCR report says.