Why this guidance deserves more than a compliance memo When the Reserve Bank of India released its Internal Risk Assessment Guidance for Money Laundering/Terrorist Financing Risks on 10 October 2024, the immediate reaction across the industry was predictable: law firms issued client alerts, consulting firms published two-page summaries, and compliance heads circulated the PDF with […]
A Practitioner’s Perspective on India’s BFSI Sector, coupled with Global Best Practices 1. Introduction: A System Crying Wolf In the world of Anti-Money Laundering (AML), the transaction monitoring system is the frontline sentinel – a rules based or mode -driven engine designed to flag suspicious financial activity for human review. Yet across Indian banks, NBFCs, […]
Risk-Based in Name, Rule-Based in Practice India’s anti-money laundering framework has undergone a visible transformation over the past decade. Regulatory expectations have expanded, reporting obligations have intensified, and financial institutions today operate within a significantly more mature AML/CFT environment than they did even a few years ago. This evolution was reflected in India’s recent Mutual […]
Preface: A Problem Hiding in Plain Sight There is a peculiar quality to the mule account threat that makes it so difficult to tackle: the account looks entirely normal. The account holder is real. The KYC documents seem genuine. The account was opened through a legitimate branch or a verified digital onboarding channel. The first […]
India’s anti-money laundering framework is no longer the patchwork it once was. The Prevention of Money Laundering Act, 2002 (PMLA), as reinforced by the PML Rules 2005 and a dense web of regulatory directions from the Reserve Bank of India (RBI), the Securities and Exchange Board of India (SEBI), the Insurance Regulatory and Development Authority of India (IRDAI), the International Financial Services Centres Authority (IFSCA), and the Pension Fund Regulatory and Development Authority (PFRDA), has created one of the more comprehensive anti-money laundering and counter-financing of terrorism AML/CFT) architectures in the world.
There is a foundational assumption embedded in every AML programme in India – one so basic that it is rarely examined: that the compliance function knows what it is looking for. Transaction monitoring rules are built around typologies. STR narratives are structured around suspicion. Risk ratings are calibrated around customer profiles. But all of it […]
There is a question that sits quietly at the centre of every AI-driven AML programme, rarely asked aloud but increasingly impossible to ignore: when a machine flags a customer as suspicious, freezes an account, or generates a suspicious transaction report – who is actually responsible for that decision? The honest answer, in most institutions today, […]
Every morning, across hundreds of banks, NBFCs, fintechs, and securities firms in India, AML analysts sit down to a queue of alerts. Some are obvious. Most are not. A few will matter enormously; not just to the institution but to the integrity of the financial system itself. The analyst’s job is to sift through the […]
In India’s financial institutions, a fundamental reorientation is underway – one that is as much about governance philosophy as it is about regulatory obligation. The question is no longer whether Anti-Money Laundering (AML) and Counter-Terrorist Financing (CFT) deserve boardroom attention.
Money laundering costs the global economy an estimated 2 to 5% of GDP annually between $800 billion and $2 trillion, according to the UN. In India alone, enforcement agencies have attached assets worth thousands of crores over the last decade, across real estate, shell structures, and increasingly, digital financial rails.