- FATF praises India’s progress on money laundering controls.
- Gaps in crypto regulation flagged as a potential risk.
- Binance returns to Indian market, raising regulatory concerns.
The Financial Action Task Force (FATF) praised India’s progress in fighting money laundering, noting the country’s success in seizing criminal assets and tackling illicit financial flows.
However, the agency also flagged concerns over the lack of strong oversight in India’s fast-growing crypto sector, warning it could be a significant vulnerability.
The FATF report stated that the implementation of preventative measures by the non-financial sector and virtual asset service providers (VASPs), and supervision of those sectors, is still at an early stage.
While India has made strides in aligning its financial intelligence and enforcement agencies with global standards, gaps in the regulation of VASPs persist, creating potential vulnerabilities.
The report also acknowledged India’s improved ability to identify money laundering and terrorist financing risks, as well as its efforts to seize assets linked to criminal activities.
However, delays in prosecuting these cases, along with a significant backlog of trials, continue to hinder overall progress.
The issue of cryptocurrency regulation has drawn further attention following Binance’s recent return to the Indian market.
The world’s largest crypto exchange resumed operations after registering with India’s Financial Intelligence Unit (FIU), a key compliance requirement.
While this is seen as a step forward, the FATF report stresses that stronger oversight of the crypto industry is urgently needed to prevent financial crime.
