New Delhi, Nov 5: The Financial Action Task Force (FATF), the global watchdog on terror financing and money laundering, has commended India’s asset recovery framework and described the Enforcement Directorate (ED) as a model agency for other nations to emulate.
In its newly released report, “Asset Recovery Guidance and Best Practices,” the FATF recognised India among jurisdictions that have developed robust legal and operational mechanisms for confiscation and management of assets linked to crime and money laundering.
The report highlighted India’s proactive use of both conviction-based and non-conviction-based confiscation provisions, crediting the ED for its coordination with foreign counterparts under mutual legal assistance treaties. The FATF observed that the ED’s asset recovery strategy reflects a “mature, well-resourced, and technology-driven approach” that aligns with global standards making asset recovery a national policy priority.
It also praised India’s legislative framework under the Prevention of Money Laundering Act (PMLA), which allows swift freezing, attachment and confiscation of criminal proceeds even before conviction. The report further appreciated India’s inter-agency cooperation between the Financial Intelligence Unit (FIU-IND), Central Bureau of Investigation (CBI) and the ED, calling it a model for integrating intelligence, enforcement and prosecution in financial crime cases.
The FATF cited India’s international cooperation record, including the successful repatriation of assets from foreign jurisdictions, as evidence of a maturing asset recovery ecosystem. “India’s performance, particularly through the ED, illustrates how consistent policy, legal empowerment and institutional coordination can lead to tangible results in depriving criminals of illicit wealth,” the report said.
India Among Global Leaders
Through its findings, FATF underscored that India’s asset recovery regime “reflects a sophisticated institutional framework that prioritises restitution and transparency.” It recognised the ED’s integration of financial intelligence with enforcement and judicial coordination, resulting in swift freezing and disposal of criminal assets.
The FATF report concluded that India’s approach aligns with its new 2023–24 asset recovery standards, encouraging early financial investigation, inter-agency cooperation and public-benefit reuse of recovered assets. It urged other member nations to replicate India’s victim-focused recovery model.
The report also featured multiple Indian case studies demonstrating large-scale recoveries led by the ED that benefited thousands of victims.
In one investment fraud case, an Indian company lured investors with land and high returns, later diverting funds to unrelated ventures. The ED attached assets worth ₹6,000 crore, supplementing attachments by the Crime Investigation Department (CID).
In a corporate bond scam, a fraudulent firm raised public money through secured debentures and diverted funds via shell companies. Following ED’s attachment, a state High Court committee released ₹538 crore to compensate over 75,000 investors.
In a cooperative bank scam, where officers siphoned funds through benami accounts, the ED attached assets worth ₹290 crore, which were later handed to the Maharashtra Protection of Interest of Depositors (MPID) authority. The confiscated land was repurposed for public infrastructure, including an airport.
FATF also noted India’s innovative use of “value-based confiscation” under PMLA, where properties worth ₹1,777 crore—equivalent to assets moved abroad—were attached, ensuring recovery even when original assets were hidden overseas. The FATF described this as a “best-in-class application” of value-based asset recovery powers.
The report concluded that India’s comprehensive framework, strengthened by the ED’s proactive enforcement and technology-led coordination, represents a mature and globally relevant model for recovering assets linked to crime and corruption. (Agencies)
