The U.S. State Department has hit out at India for ineffective implementation of anti-money laundering (AML) and counterterrorist financing (CFT) laws arguing that even when Washington supplied Modi government officials with intelligence on terrorism-related funds, basic seizures were not followed up with investigations, thus ceding ground on a more comprehensive approach.
Country report In its “Country Terrorism Reports 2014,” released to media here, the Department noted that despite India aligning its domestic AML-CFT regime with international standards, “The Indian government has yet to implement the legislation effectively, however, especially with regard to criminal convictions”.
Law enforcement agencies typically opened criminal investigations reactively and “seldom initiate proactive analysis and long-term investigations”. Specifically, the U.S. alleged that the Indian government was restricting its enforcement anti-hawala prosecutions to non-financial businesses only, and more than two years after the Prevention of Money Laundering Act, “the government has not taken adequate steps to ensure all relevant industries are complying…”
What the report says... |
| 1 | India is restricting its enforcement of anti-hawala prosecutions to non-financial businesses only. |
| 2 | United States investigators have had limited success in coordinating the seizure of illegal proceeds with their Indian counterparts. |
| 3 | India continued to be a major target for a range of terrorist groups; in 2014, around 400 people were killed as a result of terrorist attacks in India. |
More broadly, the report noted, “U.S. investigators have had limited success in coordinating the seizure of illicit proceeds with their Indian counterparts,” in part due to the poor follow-through on intelligence leads supplied by the U.S. Threats to India Despite this specific criticism, the Department underscored the fact that India continued to be a major target for a range of terrorist groups, noting that the U.S. National Consortium for the Study of Terrorism and Responses to Terrorism found that approximately 400 people were killed as a result of terrorist attacks in India in 2014 overall.
The report also outlined the serious nature of the threat posed to India by Islamic State (IS), asserting. “Given India’s large Muslim population, potential socio-religious marginalization, and active [IS] online propaganda efforts, there remains a risk of increased [IS] recruitment of Indian nationals.”
During 2014, attacks and fatalities in Jammu and Kashmir and against Indian facilities in Afghanistan were attributed to “transnational terrorist groups such as LeT, which continued to operate, train, rally, propagandise, and fundraise in Pakistan,” it noted.
"LeT operates freely in Pakistan"
The U.S. performed a careful balancing act by calling Pakistan, an ally in its fight against terror, both a target of numerous terrorist attacks and also as a country that had failed to act effectively against groups that threatened India, such as Lashkar-e-Taiba (LeT).
“LeT and its alias organisations continued to operate freely in Pakistan, and there were no indications that Pakistan took significant enforcement actions against the group,” the State Department said in its report.
Even though the U.S. considered Pakistan a “critical counterterrorism partner… plagued with numerous violent extremist groups,” it described counterterrorism cooperation with Islamabad during 2014 as “mixed,” particularly given Pakistan’s continued denial of visas for U.S. trainers focused on law enforcement and civilian counterterrorism assistance.
The report also remarked upon the region-wide effects of Pakistan allowing LeT to operate freely on its soil, citing the May 26, 2014 attack by the terror outfit against the Indian consulate in Herat, Afghanistan.
