- August 12, 2023
- Posted by: OptimizeIAS Team
- Category: DPN Topics
Subject : Economy
Section: External Sector
- US set to unveil long-awaited crackdown on real estate money laundering
What is FinCEN:
- FinCEN stands for the Financial Crimes Enforcement Network.
- It is a bureau of the United States Department of the Treasury responsible for combating financial crimes, including money laundering, terrorist financing, and other illicit financial activities.
- It was set up in 1990.
- FinCEN’s primary role is to collect, analyze, and disseminate financial intelligence to law enforcement agencies, regulators, and financial institutions to help combat financial crimes and protect the integrity of the financial system.
- FinCEN exercises regulatory functions primarily under the Currency and Financial Transactions Reporting Act of 1970, as amended by Title III of the USA PATRIOT Act of 2001 and other legislation, which legislative framework is commonly referred to as the “Bank Secrecy Act” (BSA).
- FinCEN serves as the FIU for the United States and is one of more than 100 FIUs making up the Egmont Group, an international entity focused on information sharing and cooperation among FIUs.
What is Suspicious Activity Report:
- It is a document that financial institutions and certain other businesses are required to file with the Financial Crimes Enforcement Network (FinCEN) in the United States when they encounter transactions or activities that appear to be suspicious or potentially related to money laundering, terrorist financing, or other illegal or illicit activities.
- These documents are meant to red flag, within 30 days of the transaction’s occurrence of criminal funds or any form of dirty money; insider trading; potential money laundering; terror financing; any transaction that raises suspicion.
- These are used to detect crime but cannot be used as direct evidence to prove legal cases.
What is FIU:
- FIU stands for “Financial Intelligence Unit.“
- It is a specialized government agency or unit responsible for collecting, analyzing, and disseminating financial intelligence related to suspicious and potentially illicit financial activities.
- The primary purpose of an FIU is to combat money laundering, terrorist financing, and other financial crimes.
What is Financial Intelligence Unit – India (FIU-IND):
- FIU-IND is an independent body reporting directly to the Economic Intelligence Council (EIC) headed by the Finance Minister.
- FIU-IND is a multi disciplinary body with a sanctioned strength of 75 personnel–from different organizations namely Central Board of Direct Taxes (CBDT), Central Board of Excise and Customs (CBEC), Reserve Bank of India (RBI), Securities Exchange Board of India (SEBI), Department of Legal Affairs and Intelligence agencies.
- It was set by the Government of India on 18th November 2004.