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regular-article-logo Friday, 17 May 2024

American online payment gateway PayPal to report transactions under anti-money laundering law

Move to boost India’s efforts to show that its financial systems, currently under FATF review, are becoming 'robust'

PTI New Delhi Published 31.07.23, 09:47 AM
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A recent Delhi High Court ruling that declared American online payment gateway PayPal a ‘’reporting entity’’ under the anti-money laundering law will boost India’s efforts to show that its financial systems, currently under a FATF review, are becoming “robust”, financial investigators have said. The court of Justice Yashwant Verma on July 24 ruled that PayPal was liable to be viewed as a payment system operator under the Prevention of Money Laundering Act (PMLA) even as it quashed a Rs 96-lakh penalty imposed on the firm imposed by the Financial Intelligence Unit (FIU) in December 2020. The Financial Action Task Force (FATF), a Paris headquartered global body, leads action against money laundering and terrorist financing crimes. A review of the Indian anti-money laundering systems is currently underway and a visit of the FATF team is expected to commence in November. Top officials in financial law enforcement agencies told PTI that the categorisation of PayPal as a reporting entity under the PMLA will ensure that all such big payment gateways and platforms are regulated and they share the stipulated suspicious transaction reports (STRs) and cross-border wire transfer reports with the FIU under the PMLA. The FIU, as per its mandate, disseminates these reports to various probe agencies which investigate money laundering, tax evasion, and other serious financial frauds.

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