Anti-Money Laundering(AML)/Combating Financing Terrorism(CFT) - India in the Global Context

  The Financial Stability Board is an international body that monitors and makes recommendations about the global financial system. It was established in the 2009 G20 Pittsburgh Summit as a successor to the Financial Stability Forum. The Board includes all G20 major economies, FSF members, and the European Commission. The FSB, in consultation with the Basel Committee on Banking Supervision (BCBS) and national authorities, has identified global systemically important banks (G-SIBs) since 2011. The list of G-SIBs is divided into ‘buckets’ corresponding to required level of additional loss absorbency.  The list of G-SIBs is updated annually each November, together with information on the application of policy measures to G-SIBs under the integrated set of policy measures to address the systemic and moral hazard risks associated with systemically important financial institutions published by the FSB in 2011. BCBS publishes the  methodology  for assessing and identify...

  Red flags in Anti-Money Laundering /Combating the Financing of Terrorism(AML/CFT)  are indicators of potential illicit activities and include unusual transactions, secretive clients, Politically exposed Persons(PEP) , High risk Jurisdictions , Complex Ownership Structures  and large cash transactions.  These warning signs, which do not automatically confirm wrongdoing, trigger further investigation and may lead to the submission of a Suspicious Transaction Report to the relevant Financial Intellegence Unit (FIU).   Following FATF guidance and local legislation, AML programs should ensure a risk-based model that reflects their threat landscape and regulatory environment, effectively highlighting any AML red flags. This should include suitable CDD Process, identifying customers for enhanced due diligence (EDD), Transaction Monitoring Solutions  and sanctions, PEPs, and adverse media screening. FATF red flags in the cap...