FIU raps banks for cash info delay

Financial Intelligence Unit-India (FIU), an agency responsible for maintaining data to combat money laundering , has asked commercial banks to improve their reporting behaviour and use electronic format to send information.

Public sector banks are slow in submitting reports to FIU intelligence unit on cash transactions. Those who send information provide it in a manual format, making data analysis and value addition tedious, Its director Arun Goyal told reporters on the sidelines of the Seminar on banking security organised by Indian Bank's Association here today.

The Prevention of Anti Money Laundering act 2002 and rules came into force from July 2005. Banks have started sending in reports, on cash transactions involving over Rs 10 lakh and suspicious transactions, only since February- March 2006, He said.

According to records with FIU, State Bank of India and its associates are yet to commence reporting. Of 19 banks, only six have sent CTRs. Private and foreign banks are much active in compliance as 16 private and six foreign banks are sending in reports on cash transactions.

At present banks, financial institutions and market intermediaries are required to send CTRs and STRs and The government is considering to make money transfer agents and foreign exchange dealers to reporting the financial transactions for improving the monitoring. this would require amendment to to AML legislation, Goyal said

Banks need to set up anti-money laundering solutions as early as possible. They will help to provide general alerts, analyse data and decide whether a transaction is suspicious, he added.