Reporting norms for broking houses and depository participants are likely to made more stringent this financial year (FY09) as the government steps up vigil to track individuals suspected of money laundering activities.
The Financial Intelligence Unit-India plans to make reporting mandatory for all the transactions in excess of Rs 10 lakh (Rs 1 million) a month, particularly for broking houses.
The move is under consideration as the cash transaction reports just from commercial banks have shot up from 2.2 million to nearly 6 million for FY08.
The number could go up further since data for the full financial year is still being compiled. Similarly, last year, the agency received more than 2,500 suspicious transaction reports from various entities in the financial sector, as compared with 817 in FY07.
A senior FIU-IND official said the agency was planning to issue a fresh set of anti-money laundering guidelines, particularly for depository participants, or DPs, and broking houses.
"With the increase in the volume of transactions, it has become all the more important to have proper knowledge of all the accounts and keep track of the big transactions. The number of transactions in excess of Rs 10 lakh a month are seeing a rapid rise," the official said.
The source also mentioned that most CTRs come primarily from banks and not broking houses.
The Prevention of Money laundering Act 2002 came into force on 1 July, 2005. The government set up and designated FIU-IND as the agency to receive and process information relating to large cash and suspicious transactions under PMLA.
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